Category: Finance

The loyalty penalty in banking Millions of customers who have been loyal to their banks for years are being exploited by low interest rates on their savings accounts. This is the conclusion of a recent report by the Financial Conduct Authority (FCA), the UK’s chief financial regulator, which warned that the “harm” caused by this practice has worsened as interest rates have risen. The FCA said it had challenged some…

Fintechs have been disrupting the financial services industry for years, offering innovative solutions to customers’ needs and challenges. However, as the market becomes more competitive and regulated, fintechs may find it harder to grow and scale on their own. That’s why partnering with banks could be a strategic move for fintechs in 2024, as it could bring mutual benefits and opportunities for both parties. The benefits of fintech-bank partnerships Fintechs…

The Australian Competition and Consumer Commission (ACCC) has released a report on the retail deposit market, calling for reforms to improve competition and consumer outcomes. The report found that banks use pricing strategies and product design to reduce the cost of their deposit funding, while creating barriers for customers to switch to better deals. Banks exploit consumer inertia and biases The ACCC report, which was commissioned by Treasurer Jim Chalmers…

The Reserve Bank of India (RBI) Governor, Duvvuri Subbarao, has expressed his dissatisfaction with the current level of penalties imposed on banks that violate the central bank’s regulations. He said that the maximum penalty of Rs 1 crore is “peanuts” compared to the size and profits of the banks. Why are the penalties low? According to Subbarao, the penalties on banks in India are low because of the legal constraints.…

The amount of unclaimed deposits in both public and private sector banks has increased by 28% to ₹42,270 crore in the financial year 2022-23, according to the data presented by the Ministry of Finance in the Parliament. This is the highest amount of unclaimed deposits ever recorded in the history of Indian banking. What are unclaimed deposits and why do they matter? Unclaimed deposits are those deposits that have not…

The Central Bank of Kenya (CBK) recently increased its benchmark lending rate to an 11-year high of 14.5 percent, in a bid to curb inflation and stabilize the shilling. This move has had a ripple effect on the cost of borrowing for consumers and businesses, who are now feeling the pain of higher interest rates. Consumers face higher loan repayments and reduced spending power One of the immediate impacts of…

The Reserve Bank of India (RBI) has imposed monetary penalties on 176 cooperative banks across six states for breaching various regulatory norms in the financial year 2022-23. The total amount of fines levied by the RBI on these banks is Rs 14.04 crore, according to the RBI’s Annual Report for 2022-23 released on Tuesday. Reasons for penalties The RBI said that the penalties were imposed for contraventions or non-compliance with…

Land banking is a practice where developers buy land and hold it for future development, often without planning permission, in order to profit from rising land values. This reduces the supply of land available for housing and drives up prices, making it harder for local authorities and social housing providers to build affordable homes for the people who need them. Labour has proposed a radical reform of the planning system…

China’s banking sector is facing a rising tide of bad loans as the country’s economic slowdown and the impact of the COVID-19 pandemic take a toll on consumer credit. The four largest state-owned banks have increased their provisions for potential losses, while smaller lenders are selling off their distressed assets to cope with the pressure. Bad loan ratio hits highest level since 2009 According to the China Banking and Insurance…

Nigerian banks are facing a severe shortage of cash as the festive season approaches, due to a combination of insider abuse and hoarding by customers. This has led to long queues at ATMs, reduced withdrawal limits, and increased charges for cash transactions. Insider abuse erodes bank liquidity According to a report by BusinessDay, some bank staff have been involved in fraudulent activities that have drained the liquidity of their institutions.…