Guidelines regulating role of advisers soon: SEBI

SEBI, which had put up a discussion paper on the role of investment advisors, has received detailed feedback.  The market regulator is set to announce norms for regulating these entities soon

New Delhi: Capital market regulator Securities and Exchange Board of India (SEBI) on Tuesday said it will soon come out with norms for regulating the role of investment advisors, reports PTI.

“We have received a very detailed feedback and we are undergoing a process of discussion and shortly we will come out with regulations (on investment advisers),” SEBI whole-time member Prashant Saran said here.

“It is very difficult to give a time-line. We do need to build a consensus,” he said on the sidelines of an Assocham event here.

In September this year, SEBI had proposed to bar investment advisers from acting as agents for promoting financial products.

The entities, which include banks and fund managers, would have to be registered with a self-regulatory organisation (SRO) as investment advisers, said the concept paper on Regulation of Investment Adviser issued SEBI.

“No financial incentives/consideration would be received from any person other than investors seeking advice. In case of advice regarding investment in entities related to the investment adviser, adequate disclosures shall be made to investor regarding the relationship,” the paper had said.

It had said, “The person who interfaces with the customer should declare upfront whether he is a financial adviser or an agent of the manufacturer.”

Mr Saran said mutual funds must increase their penetration in smaller cities and rural areas while financial literacy should spread among the uneducated also.

The focus should be on small investors so that the base widens. Financial education should be sector-specific and product-neutral, he said.

Most of the money parked in mutual funds comes from institutional investors which include corporates, banks and foreign institutional investors (FIIs).

Many financial products are becoming complicated and it is not easy for even an educated person to understand and analyse them, he said.

At the same time, Mr Saran said financial structures across the world do not command as much respect as they used to in the past.

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Getting the most of your mobile phone plans

 

Every which way, as India heads rapidly into what can be defined as an Age of Austerity, every rupee saved will be a rupee earned was never truer now than before. Bringing down small expenses starts with you, and the communication bill is one element here

When was the last time you compared your mobile phone plans, prepaid or postpaid, with other plans from the same or other service providers, to see if you could achieve lower rates?

If you thought that the putting this as a query to customer care at your telecom company was going to get you a solution, then forget it, the call centres are trained to deflect this. Getting on the website or visiting a dealer outlet is a better idea.

In this correspondent's case, a review of plans about two years ago and then once more a few days ago brought about a saving of around 40% each time. Of course, each time this took a lot of research, and that can get your head spinning. But there are easier ways.

Here’s how to do it:-

  1. Ask for details of your present plan from customer care. If it is in the “not available any more” list, then chances are that it was either too expensive to survive or it is such an amazingly low-cost plan that you have nothing to worry.
  2. Call a competing telecom service and ask them to guide you on competing plans. They will ask for copies of your old bills and guide you accordingly. After this, call your existing telecom service and ask for information on how to migrate, and when they ask you why—give them the competing rate plan you are getting and watch them match it.
  3. Check out the MTNL/BSNL websites for rate plans in your areas, or pay a visit to their customer service offices—they are indeed very helpful and can be compared to the Mother Dairy of vegetable shopping in terms of reliability and cost. Take your existing bills along. They also have interesting options combining land lines, mobile phones and broadband/internet/GPRS as well as true third generation (3G).

Every which way, as India heads rapidly into what can be defined as an Age of Austerity, every rupee saved will be a rupee earned was never truer now than before. Bringing down small expenses starts with you, and the communication bill is one element here. Good luck!!

 

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Parliamentary panel rejects govt proposal to hike FDI cap in insurance

The Standing Committee on Finance in its report on the Insurance Laws (Amendment) Bill, 2008, said the proposal to increase the FDI cap to 49% in insurance companies seems to have been decided upon “without any sound and objective analysis of the status of the insurance sector following liberalisation”

New Delhi: In an another instance which may stall reforms, a Parliament panel has rejected the government proposal to hike the foreign direct investment (FDI) cap in the insurance sector to 49%, saying this may not have the desired effect and could expose the economy to global vulnerability, reports PTI.

The Standing Committee on Finance in its report on the Insurance Laws (Amendment) Bill, 2008, said the proposal to increase the FDI cap to 49% in insurance companies seems to have been decided upon “without any sound and objective analysis of the status of the insurance sector following liberalisation”.

“The committee feel the suggested policy stance of enabling a greater role for foreign capital in the insurance sector, may not necessarily have the desired impact...” the report, tabled in Lok Sabha, said.

The panel, headed by senior BJP leader Yashwant Sinha, however, agreed with the need to bring in comprehensive changes in the archaic laws governing the insurance sector.

“Increased role of foreign capital may lead to the possibility of exposing the economy to the vulnerabilities of the global market... flight of capital outside the country and also endangering the interest of the policy holders,” it said.

It further said that in view of the fact that the finance ministry could not convincingly justify the proposal, the committee considers that any further hike in FDI cap in the present global economic scenario, may not be in the interest of the Indian insurance industry.

It noted that the common man too would not stand to gain through insurance, particularly as a means of social security.

The Bill was introduced in the Rajya Sabha in December 2008 with an aim to bring improvement and revision of laws relating to insurance business in the changed scenario of private participation. It was referred to the Standing Committee.

Last month, the government had to shelve its plan to allow 51% FDI in the multi-brand retail amid stiff opposition from different parties, including some of its own allies.

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