Big Relief for Bankers as MHA Asks Local Administration to Provide Security, Maintain Social Distancing
In a big relief to bankers providing crucial services to customers during the corona virus (COVID19) lockdown, the ministry of home affairs (MHA) has said the local administration would provide adequate security personnel for bank branches for maintaining social distancing and law and order situation.
 
On Monday, Moneylife highlighted difficulties faced by bankers due to increased number of customers and filing of cases by local administration against them for not following the social distancing norms. (Read: COVID19: Who Will Save Bankers from Corona, Customers and Local Administration?, based on the tweets of a banker who calls himself Newton Bank Kumar (@idesibanda). 
 
  
In its revised guidelines for lockdown2, the MHA says, "Bank branches be allowed to work as per normal working hours till disbursal of direct benefit transfer (DBT) cash transfer is complete. Local administration to provide adequate security personnel at bank branches and business correspondents to maintain social distancing, law and order and staggering of accounts holders."
 
However, now bankers are facing other issues. Especially some state government are asking bankers to provide at customer’s doorstep relief money transferred by them or the Indian government.
 
 
In fact, the Haryana government even asked some banks to open new accounts for beneficiaries who does not have an account so that it can transfer money.
 
 
As Moneylife had pointed out banking is the backbone of economy and so during the COVID19 pandemic, it was considered as essential service.
 
Bankers were asked to keep branches functioning with skeleton staff. However, due to lack of protective gears and mostly any security, these bankers are finding it very difficult to handle the situation, and are constantly working under fear of catching corona or facing anger from customers. 
 
There have been some incidents where customers tried to attack bankers as well. Main issue all bank staff is facing is overcrowding in branches and lack of social distancing. However, instead of helping bankers do their jobs at some places like Barabanki, and Meerut. 
 
 
In fact, in Gurdaspur in Punjab, one deputy commissioner of police detained a bank manager for failing to enforce social distancing norms. As per report from The Tribune, after seating in the police station for half an hour, the manager was asked why he let the customers break social distancing norms.
 
 
After witnessing huge crowd in bank branches to withdraw the relief amount announced by the government and pension by the pensioners, almost all state level bankers' committee (SLBC) have decided to extend banking hours by one or two hours. Last month when the lockdown was announced by the central government, the SLBC had decided that bank branches would work between 10am to 2pm.
 
While in some states, banks continue to remain open for extended hours, the SLBC in Tamil Nadu has decided to revert to working between 10am to 2pm. With the footfalls of monthly pensioners and others in bank branches falling down, the SLBC had taken the decision.
 
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    COVID-19 Lockdown: How to get cash from your bank at your doorstep?
    India has been in a nationwide lockdown since March 24th, which has now been extended to May 3rd. Several areas are in complete lockdown and it has become a challenge to even visit the bank or ATM to withdraw cash. Senior citizens are particularly affected. Are there options to get money at your doorstep?
     
    You can now request for cash sitting in the safe confines of your home. Several banks are rolling out a doorstep delivery of cash. This service has come in for senior citizens, especially abled. Several large banks including SBI, HDFC Bank, ICICI, Axis Bank and Kotak Mahindra Bank are now offering this facility to their customers. Here is what each bank is offering.
     
    SBI: India’s top lender provides doorstep-banking services to its customers and cash is delivered under its doorstep delivery services. This facility is currently available for senior citizens, differently-abled people. However, SBI account holders will be able to avail these services at select branches only. Here are the details of SBI's Doorstep Banking (DSB) Services:
     
    1) Doorstep banking service includes cash pickup, cash delivery, cheque pickup, cheque requisition slip pickup, form 15H pickup, delivery of drafts, delivery of term deposit advice, life certificate pickup and KYC documents pickup.
     
    2) The service request can be made at toll free number 1800111103 between 9 am to 4 pm on working days at the centre.
     
    3) The service request for registration is done at the home branch.
     
    4) Doorstep banking service is available to only fully KYC-compliant customers.
     
    5) Service charges per visit for non-financial transactions is Rs60+GST and Rs100+GST for financial transactions
     
    6) The amount of cash withdrawal and cash deposit is restricted to Rs 20,000/-per transaction per day.
     
    7) Account holders with a valid registered mobile number within 5 Km radius of their home branch will be able to avail these services.
     
    8) Customers with accounts that are operated jointly will not be able to avail these services.
     
    9) The service will also be unavailable for minor account and accounts of non- personal nature.
     
    10) Withdrawal will be permitted using cheque / withdrawal form with passbook.
     
    How to avail of SBI’s doorstep banking service:
     
    SBI customers who wish to avail this door-step delivery service should call toll free number 1800111103 between 9 am to 4 pm on working days from their registered mobile number.
     
    Once the call is connected, customer shall input last 4 digit of savings bank/current account number for which doorstep banking service is registered.
     
    After initial verification, the call shall be forwarded to Contact Centre Agent, who after second/additional verification, shall record the request.
     
    The customer shall provide the detail of request and preferred time of service delivery (9 am to 5 pm).
     
    Once the request is accepted, the customer will get an SMS with Case ID and request type.
     
    The request shall be forwarded to Doorstep Banking Agent who will contact the customer and fix an appointment.
     
    At the given time, the Doorstep Banking Agent (DSA) shall visit the registered address of the customer and show his Photo ID card and officially valid document (OVD).
     
    He will also verify the identity of customer through Photo ID and OVD of the customer.
     
    The service request shall be initiated in the Doorstep Banking web portal in the mobile carried by the DSB Agent. Customer shall input Case ID and Verification Code in the web portal to initiate the transaction.
     
    The customer will receive SMS for the completion of transaction. 
     
    More details can be found at https://sbi.co.in/dsb
     
    The official SBI account has shared tweets about their doorstep cash delivery:
     
     
     
     
    How is the service working? Several customers were happy with this doorstep cash delivery service. Many of them tweeted their thank you.
     
     
    HDFC bank: Offers cash delivery and pick-up and cheque pick-up services through its doorstep banking. The bank carries multiple verifications and identification to ensure security. Customers too need to check the photo ID proof of pick-up person before transacting. These transactions are also protected by comprehensive insurance. Customers need to get in touch with their local HDFC bank branch for more details.
     
    Make sure you read the terms and conditions and all the small print before availing of any bank’s doorstep banking services.
     
    Similarly you can check out doorstep banking offered by Axis Bank on their website at https://www.axisbank.com/bank-smart/doorstep-banking/doorstep-banking
     
    Mobile ATMs: HDFC bank has announced that the bank is deploying Mobile Automated Teller Machines (ATMs) to assist customers during the lockdown. These mobile ATM facilities are to operate between 1000 to 1700 hours. The mobile ATM will cover three to five stops in a day. The bank said “HDFC Bank’s mobile van carrying the ATM has been successfully piloted in Mumbai, Noida, Allahabad and Coimbatore, with plans to extend the service to the rest of the country shortly”.
     
     
    The locations for deployment are being identified in consultation with local municipal authorities in respective cities. 
     
    Several other banks like SBI, Axis, ICICI, Canara Bank, Bank of Baroda and PNB have started deploying Mobile ATMs in order to service their customers conveniently. The customer even gets messages on their cell phone to alert them that a mobile ATM is in their area/ locality and the route that the Mobile ATM plans to take. 
     
     
    These mobile ATMs offer all the services that are available at normal ATMs. Apart from cash withdrawals, other services which can be availed by customers are transfer of funds to registered payees, change of PIN, recharge of pre-paid mobiles, fixed deposits, cardless cash withdrawals. ICICI has deployed mobile ATMs in NCR, Noida, Chennai and some districts of UP. 
     
     
     
     
    In the rural areas, where banking services are limited, the role of banks and its correspondents has been key to enable access of funds for the poor. “Bank mitras” or business correspondents are playing a crucial role in the financial inclusion and are mediators between banks and customers. Banking correspondents have played a crucial role in the rural areas for smooth disbursal of funds during this current lockdown.
     
    Meanwhile the RBI has also reiterated that doorstep banking has to be provided to senior citizens and differently abled people. The details have to be adequately promoted (w.r.t branches providing these services, etc) through brochures etc.
     
     
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    COMMENTS

    Ramesh Popat

    4 months ago

    Good if implemented well.

    Debt Moratorium to Ease Near-Term Pressure on Securitised Transactions: Ind-Ra
    The corona virus (COVID-19) pandemic will have a limited near-term impact on the cash flow cover of securitisation pool, assuming the availability of moratorium to borrowers. For the transactions benefitting from the moratorium, there will not be any immediate impact on the ratings. However, future cash collections would depend on the underlying asset class performance which is driven by the economic outlook. In such a scenario, a lower-than-expected pool performance could affect the ratings, says India Ratings and Research (Ind-Ra).
     
    The ratings agency says it believes that the credit enhancement (CE) for the majority of its rated securitisation transactions backed by retail loans is sufficient to avoid any immediate default if the moratorium is not available.
     
    However, it says, in case of a prolonged lockdown, the collection of cash could be challenging and if the moratorium is not granted to pass through certificates (PTCs) transactions, subsequent buffers of CE may become thinner and a higher-than-expected dip in the CE will result in a negative rating action.
     
    According to Ind-Ra, the moratorium would support near-term payouts but would be limited for CE over long term. "The availability of moratorium would support transaction payouts in first quarter (1Q) of FY2021. However, if the moratorium is not approved by lenders, transactions particularly those with low seasoning are likely to be more vulnerable to credit profile deterioration, as significant CE may be utilised during the three months," it added.
     
    Ind-Ra has analysed three liquidity scenarios for its rated pool. Under an extreme scenario of zero cash collections and no moratorium available to PTC transactions during 1QFY21, 50% in 1QFY21 and 50% in 1HFY21, largely all the rated transactions under different asset categories are adequately covered for 1QFY21 due to their tied up CE. However, beyond the three months, the available CE limits (if utilised) would provide limited credit support to the outstanding transactions, leading a negative rating action, it says.
     
     
    According to the ratings agency, unavailability of moratorium is leading to mismatches in asset-liability. It says, "The moratorium package does not include securitised transactions and thus the originators will require prior approval of investors to avail the moratorium. The investors or purchasers may not necessarily be regulated by the Reserve Bank of India (RBI) and hence may require directions from their regulators." 
     
    "Lenders may not be able to distinguish between the on-balance-sheet and off-balance-sheet portfolios while offering the moratorium and as a consequence, may end up providing the moratorium to borrowers, where the loans are sold down. This may create an asset-liability mismatch in the securitisation structure wherein the originator has provided the moratorium to its borrowers while the investor has not approved it. In the event the originator does not provide the moratorium to its borrower in the securitised portfolio, credit profile deterioration is likely if there is a higher-than-expected dip in CE without an adequate underlying pool performance," it added.
     
    The ratings agency says it believes the transactions with timely interest and ultimate principle payment structures will be in a better position in case their investors do not agree to the moratorium or agree only to a partial moratorium, as they have to only ensure the timely payment of interest.
     
    Ind-Ra also sees delinquencies across asset classes.  
     
    The COVID-19 related disruption would have a significant impact on both investment- and consumption-linked sectors, which were already showing signs of weakness. Against this backdrop, Ind-Ra says it has revised its GDP forecast to 3.6% from 5.5% for FY2021. The agency opines the economic recovery is likely to be prolonged. Hence, it believes that 90 days past due (dpd) could increase for all asset classes, albeit with a varying degree.
     
     
    It says, "While the slowdown will be across the sectors, consumption-linked sectors would have the first order impact due to the lockdown and a slowing business activity. Microfinance loans are the most vulnerable asset class with weaker cash flows than other asset classes. Collections are likely to deteriorate in small-ticket unsecured business loans, small ticket affordable housing loans, loans against property, commercial vehicle loans, construction equipment loans and tractor loans. Non-banking financial institutions, whose asset book typically contains commercial vehicles, construction equipment and tractor loans have granted a blanket moratorium to their borrowers. The agency expects asset classes having a strong borrower profile such as large ticket housing to face lesser impact on their cash flows."
     
     
    As the onus of providing moratorium has been left with lenders, Ind-Ra says it does not expect a uniform policy on moratorium implementation. Typically, banks can be expected to provide the moratorium to those who wish to avail it. Investors too may follow different practices, as per their policies. 
     
    "As the majority of the collections for March (April payout) have already taken place, some investors may be unwilling to provide a moratorium for April payouts including principal and interest. Mutual funds are awaiting guidance from their regulators and are in consultation with market participants regarding extending the moratorium to the instruments. Meanwhile, issuers are exploring multiple payment options regarding securitisation transactions during the moratorium period," Ind-Ra concludes.
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