29 September 2013

29 Sept: Investment Alerts :: Business Line

The RBI is asking banks to stop offering zero-interest EMI schemes on outstanding amounts on credit cards.
E-Series redemption
Do you hold units in NSEL’s E-Series gold and silver units, and despair of receiving the underlying asset? Investors can now redeem their units for cash instead of physical delivery. This redemption can be taken up from October 3 to 9 or on extinction of units, if that falls earlier. The price at which the settlement will be done depends, of course, on the prevailing price that day. The prices will be put up on the exchange’s web site. Surrender requests already put in, but not processed, would be cancelled. Settlement in cash can then be opted for. Redemption requests which have been processed will receive physical gold or silver.
Tweaking consumer financing
Financing schemes for consumer durables have come under the Reserve Bank’s scanner. In this regard, there have been several changes made. For one, say there are promotional schemes on products — a discount, a moratorium on payment and so on — banks have to pass on these benefits directly, instead of lowering the applicable interest rate to reflect the benefit.
Another key development is the RBI asking banks to stop offering zero-interest EMI schemes on outstanding amounts on credit cards. That could make you think twice about buying that shiny new plasma television!
The RBI has also disallowed shops or other establishments from charging an additional fee — usually a percentage of the transaction value — for payments made through debit cards. And finally, zero-interest EMI schemes on outstanding amounts on credit cards cannot be allowed.
All at one go
Running multiple systemic investment plans in L&T Mutual Fund? The fund house just made it a little easier for you to make these investments. It now allows combining monthly SIPs for three funds, making a single payment instead of three separate ones. This will certainly come in useful for those making payments through cheques — they can issue one cheque for all three SIPs. For new applications too, SIPs for three schemes can be done in a single form, and not separate ones for each SIP. This facility is allowed for all open-ended schemes offered by the fund house except for its Tax Saver Fund.
Not mandatory
If you haven’t got your Aadhaar card yet, there is some comfort in recent developments. Securing Aadhaar cards is optional, and not mandatory for citizens. The clarification came from the issuing agency, following pleas against decisions of some States to make the card compulsory for purposes such as registration of marriages.
Stock market happenings
SEBI last week approved a promoter group of Gillette India to reclassify their holding as non-promoter to comply with minimum shareholding norms. With this, the promoter holding drops to 75.09 per cent, which will be brought down to the requisite 75 per cent. Shares of the company shot up 10 per cent in the wake of the approval, but ended the week up 6 per cent.
Another important development unfolded in Financial Technologies. Auditors Deloitte Haskins and Sells have said that the financial statements for 2013 that they have already signed, cannot be ‘relied upon’. The stock has lost 13 per cent for the week.
The General Anti-Avoidance rules were also notified last week, which could cheer up the FII contingent. FIIs who haven’t taken benefits from tax treaties entered into by India, and investments in participatory notes will not be covered by the GAAR rules. Officials also have to give a show-cause notice to invoke the provisions. The rules will come into effect from April 2016.
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