The MSC Bank and 11 district central cooperative banks from Maharashtra were functioning without banking licence so far
Mumbai: The Reserve Bank of India (RBI) has issued banking license to the Maharashtra State Co-operative (MSC) Bank. “The bank obtained the license from RBI,” a senior government official told PTI.
The state government had written to the Centre to extend by two months the 31 March 2012 deadline set by the RBI for 11 District Central Co-operative Banks and the State Co-operative Bank to obtain the banking licence.
The Rakesh Mohan Committee recommendations, which have been accepted by the Union Finance Ministry, have made it mandatory for all the cooperative banks to get a licence before the deadline.
Across the country, there are 134 banks which do not have licence from RBI. If the banks are unable to get the licence before the deadline, they will have to become a cooperative credit society, or merge with another bank.
Maharashtra State Co-operative Bank and 11 district central cooperative banks were functioning without banking licence so far.
On 28 May 2012 last year, the RBI, on the recommendation of NABARD, had dissolved the board of directors of Maharashtra State Co-operative Bank, controlled by senior NCP leader and deputy Chief Minister of Maharashtra, Ajit Pawar, for financial irregularities.
Market leader LIC recorded 6% decline in first year premium collection while some private life insurers witnessed increase in new business
New Delhi: According to a data from regulator Insurance Regulatory and Development Authority (IRDA) total new business premium of life insurance companies in the country declined by 9.2% to Rs1.14 lakh crore from Rs1.25 lakh crore during the financial year FY12, PTI reports.
Market leader Life Insurance Corporation of India (LIC) recorded 6.1% decline in its first year premium collection to Rs81,514.5 crore from Rs86,444.7 crore a year ago.
LIC’s market share stood at 71% at the end of March 2012, according to the data. India has 24 public and private life insurance companies. The combined first year premium of private sector life insurers, declined 16.9% to Rs32,718.24 crore, from a year ago.
MetLife India showed a 52.7% increase in its first year premium for the period under review to Rs1,074.9 crore, from Rs703.95 crore a year ago.
DLF Pramerica witnessed a rise of 38.9% in its first year premium to Rs102.83 crore, Star Union Dai-ichi had an increase of 27.18% to Rs964.77 crore and IndiaFirst's new business premium rose by 39.38% on the year to Rs 982.31 crore.
The non-life insurers, however, showed an increase in their premium collection during 2011-12 to Rs58,344.16 crore, up 23.2% over Rs47,372.78 crore in 2010-11, the data said.
It is a question of time before the so-called brand ambassadors are held liable for issues like cheating in real estate or financial products, soft drinks and packaged food. After all, if cricketers and actors built their palaces on the money earned from advertising these products, then they need to consider paying for the hospitals required to cure those affected too
Genelia D’Souza, a Bollywood actress was recently summoned by the Andhra Pradesh High Court to explain her version in and role as brand ambassador in a real estate project called ‘Anjaniputra’ located close to Hyderabad Deccan that seems to have gone bust. This is the latest in how society and the laws in India are dealing with the extremely vexatious issue of misleading and deceptive advertising. It is a matter of time before similar questions are raised by other consumers, swayed into investing in products or services, by fraudulent advertisements endorsed by celebrities who are supposed to also be role models.
There are other examples as well. A clear example is the way the Goa government put a rapid end to the Airtel ad defaming Goans and Goa. If the state hadn’t, the implication is clear, this would have become an electoral issue. So, the chief minister of Goa moved and issued a simple ultimatum on behalf of the people of Goa. This is something the advertising industry has yet failed to recognise—the power of the voting public to correct such flagrant arrogance by advertisers and their agencies.
Just like with politicians, an advertisement or the brand ambassador and product behind it, can simply be voted out. Thrown out in disgrace. This message is clear—the advertiser and ad agencies cannot work on the premise that the Indian consumer is a fool. They had better learn to respect their constituency—the consumer.
Well, agencies must also question whether leading “brand ambassadors” like Sachin Tendulkar, Amitabh Bachchan and Shah Rukh Khan really have the credibility to achieve much. After all, the success of a product or service does not often correspond to that of the amount paid for the endorsement—especially when their movies don’t do well or the centuries stop flowing from their bats.
The list of endorsed products and service which flopped is almost as long as the list of brands for which these celebrities provided their name and face. But that's business, win some, lose most. However, when it comes to absolute cheating or the products are found to be harmful, what is the liability for the said brand ambassador? Shouldn’t the brand ambassador be held liable, too?
It is a question of time before the so-called brand ambassadors are held liable for issues like cheating in real estate or financial products, bad health due to soft drinks and packaged food and similar products. The laws exist, and retrospective amendments appear to be the flavour of the season—especially when they are brought in with an eye on the electorate, remember. After all, if cricketers and actors built their palaces on the money earned from advertising soft drinks and breakfast cereals, to name just two products, then they need to consider paying for the hospitals required to cure those affected too. These are misleading advertisements which have consequential effects. What about direct frauds?
In one such case of a direct fraud and outright cheating due to misleading advertisements called the “Home Trade scam”, going back to 2002, where almost Rs2,750 crore of investor funds were literally stolen and transferred to Mauritius, the luminaries endorsing the whole fraud were none other than Sachin Tendulkar, Shah Rukh Khan and Hrithik Roshan. This, by the way, included almost Rs100 crore of Seaman’s Provident Fund money—so there is a personal disclosure here, as I am an ex-seafarer. Please recall—this was in 2002, and the Bofors scam of about a decade before that was for all of Rs60 crores or so.
More details on this fraud, which is still not resolved, can be read here:-
Home Trade scam: still waiting for justice
On the other hand, this is what Piyush Pandey of Ogilvy & Mather had to say about the subject, way back in 2002: “Mr Pandey strongly believes that the Home Trade scam will neither affect the status of these celebrities nor the trend. I think celebrities just do their jobs for the money they get from the company. And they have nothing to do with the company.”
Blame The Brand, Not The Ambassador: Experts
(The Seaman’s Provident Fund money, by the way, was repaid in full by the Government of India, out of our tax-payer’s money. And I presume the advertising agencies will be following fresh developments on this issue carefully, as will the celebrities. The almost total absence of cricketers and movie stars from soft drink ads in the recent past is one such aspect. Mr. Pandey might wish to consider getting his brand ambassadors to reimburse the Government of India on this one head alone, to start with?)
Move on to the present date. The dividing line between a paid advertisement and an editorial or news report has almost vanished in most mainstream media. But this deception has not gone un-noticed, and at a recent seminar held in Delhi under the aegis of the ministry of consumer affairs, the larger issue of misleading advertisements of all sorts having reached menacing proportions was brought out.
Moneylife’s managing editor Sucheta Dalal was an invited speaker at this seminar and her presentation is going to be provided along with this article. The seminar brought out the following aspects of misleading and fraudulent advertising:
# Due diligence and restraint to be exercised while working within the guarantees of freedom of speech
# The definition of the term “misleading advertisement” globally and in India
# The shared responsibilities of the three stake-holders—advertiser, advertising agencies and the media
# The problem of misleading advertisements in India despite legislations
# Liability of endorsements by “brand ambassadors” or similar
# Suggestions from the consumers and others impacted by misleading advertisements
(For more info click here)
Moneylife shall follow and report on this subject regularly, and readers are invited to provide their views.
(Veeresh Malik had a long career in the Merchant Navy, which he left in 1983. He has qualifications in ship-broking and chartering, loves to travel, and has been in print and electronic media for over two decades. After starting and selling a couple of companies, is now back to his first love—writing.)