ING Vysya launches multicurrency prepaid forex card with Visa

The card is currently available in five foreign currencies - USD, Pound, Euro, Australian Dollar and Japanese Yen

The ING Vysya Bank said it along with Visa has launched multicurrency prepaid forex card and it would be available in five currencies, the US dollar, pound, euro, Australian dollar and Japanese yen.

The ING Visa platinum multi currency card is a prepaid card designed to offer travellers unmatched convenience and a secure way to carry money when travelling abroad. For the first time, the Indian traveller can load five different foreign currencies on the single visa platinum prepaid card and lock in the currency exchange rates for all five currencies, the lender said in a release.
 

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Higher provisioning to increase insurers’ losses by Rs65 billion

Regulatory changes are structurally positive for general insurance sector in the long term: CRISIL

Ratings agency CRISIL said it believes that the latest regulatory developments in the motor third-party (TP) segment are likely to pose challenges for the general insurance industry in the near to medium term, but are structurally positive for the sector over the long term.

In March 2012, Insurance Regulatory Development Authority of India (IRDA) increased provisioning rates for the motor TP pool segment. The additional provisioning of Rs65 billion that this hike will necessitate will weaken the insurance industry’s underwriting performance in the interim.

Rupali Shanker, director – CRISIL Ratings, said, “We estimate the additional provisioning at Rs65 billion this time—more than twice the provisioning increase that followed IRDA’s rate hike of March 2011.”

CRISIL expects the annual hike in premium rates for the motor TP segment to benefit the industry over the long term. Consequently, the underwriting losses in motor TP segment, which has the most adverse claims performance, are likely to reduce over time. The second round of provisioning increase announced by IRDA in March 2012 takes into account the motor TP segment’s consistently adverse performance on claims, and is for each of the five years between 2007-08 and 2011-12.

While the additional provisioning for 2007-08 and 2008-09 has to be absorbed in 2011-12, IRDA has allowed companies to apportion the additional provisioning for the remaining years over three years, beginning 2011-12.

“The additional provisioning in the motor TP pool segment, and the already high claims in the motor TP and health insurance segments may impact the industry’s underwriting performance in the interim. We expect the industry’s overall underwriting losses to exceed Rs.100 billion each in 2011-12 and 2012-13,” she added.

Motor TP, the only segment that has regulated tariffs, accounts for nearly a third of the insurance industry’s overall claims. To address the issue of adverse claims performance, IRDA announced annual rate hikes in motor TP in April 2011 and again, in March 2012. The latest revision hikes premium rates for private vehicles by 5% to 8% (10% in April 2011) and those for commercial vehicles by 10% to 30% (68% in 2011), from 1 April  2012.

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Canara Bank and Bank of India cut lending rates

The country's largest lender, State Bank of India, has refrained from cutting its base rate but has cut lending rates in select products

Mumbai: State-run lenders Canara Bank and Bank of India cut their base rate or minimum rate of lending by 0.25% to 10.50% following the Reserve Bank of India's move to cut rates, reports PTI.

Both the banks also cut rates on loans under the older benchmark prime lending rate by a similar 0.25% to 14.75%, they said in separate filings to the exchanges.

The revisions are applicable from 1 May 2012, they said.

Their peer Oriental Bank of Commerce (OBC) also cut lending rates by 0.25% to 14.75% only under the BPLR, leaving the base rate untouched.

The announcements by banks come exactly a fortnight after the RBI cut its short term lending rate, the repo rate, by 0.50% to 8% prompted by lower inflation and intended at giving a boost to the sagging growth.

All the bankers had opined that the RBI move would lead to reduction in lending rates. Among those who have announced rate reductions till now are ICICI Bank, Corporation Bank and Central Bank of India.

The country's largest lender, State Bank of India, has till now refrained from cutting its base rate but it has cut lending rates in select products.

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