India has slipped by five places to 106th spot (continuous decline for five years), way below neighbouring Bangladesh, Nepal, Sri Lanka and China in the World Prosperity Index, largely due to poor ‘safety and security’ environment. In the ‘Prosperity Index’ ranking of 142 countries compiled by London-based Legatum Institute, India dropped from 101st position last year, while Norway continues to remain at the top. The 2013 Legatum Prosperity Index evaluates nations in eight categories, including education, health, economy, safety and security.
The Reserve Bank of India (RBI) has asked banks to charge customers for transaction SMS alerts on the basis of actual usage, instead of imposing a fixed fee. This step comes as a response to the Moneylife Cover Story (issue dated 5 September 2013) which highlighted that banks had suddenly started charging a flat fee and that too stealthily. While banks argue that customers must pay for the convenience of modern banking, there is a growing sense of frustration among customers about the constant, stealthy increase in bank charges. But many depositors don’t even know about these charges.
Savings bank account-holders and term deposit-holders can now earn interest at shorter intervals. Until now, banks were required to pay interest on savings account balances and term deposits at quarterly or longer intervals. The savings deposit rate for most banks is 4%pa (per annum); in some cases, it is as high as 7%. The interest rate on savings bank accounts is calculated on a daily basis. Term deposit rates are 8%-9% for tenures of one year and above.