Bankers Are Alerted,

               




        08-December-2016 18:20 IST

11-December-2016 16:56 IST

The Ministry of Finance through a letter to all the MDs &CEOs/CMDs of PSBs and Chairman, IBA directs that all the bank branches in the country be alerted to reflect correctly the cash deposit in old and new currency and inform the customers about the same; Action taken in this regard be reported by 16.12.2016.

The Ministry of Finance, Government of India through its Department of Financial Services(DFS) has asked all the Public Sector Banks(PSBs) and the Indian Bankers Association (IBA) to ensure hundred percent(100%) that deposits of new currency is properly reflected in the customers’ counterfoils. In a letter addressed to all the Managing Directors (MDs) & Chief Executive Officers (CEOs)/Chairman cum Managing Directors (CMDs) of PSBs and Chairman, IBA, the DFS has stated that maintenance of records regarding deposit of SBN and Non-SBN, as the case may be, is essential both in the bank record as well as the customer’s record. The letter further states though most banks providing correct information to the customers yet to ensure that it is done in 100% of cases without fail, all the bank branches in the country be alerted to reflect correctly the cash deposit in old and new currency and inform the customers about the same.
The Ministry has asked the MDs &CEOs/CMDs of PSBs and Chairman, IBA that this must be followed scrupulously and any deviation in this regard has to be prevented and if noticed, dealt with firmly and immediately.
The letter further states that to educate the public, banks may clearly display a prominent sign (including in the local language) in their respective branches requesting their customers to fill-up deposit slips clearly indicating old and new currency and the denomination of the notes..
The DFS has asked all the MDs &CEOs/CMDs of PSBs and Chairman, IBA to consider this urgently and action taken in this regard be reported by 16.12.2016.

The Ministry also appreciated the role played by the banks post-demonetisation especially when the old currency was accepted and till 24th November, 2016, when exchange of old currency to specified limit was also permitted.

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08-December-2016 19:57 IST

Income Tax Sleuths Unearth Innovative Methods of Laundering and Transportation of Cash at Mumbai, Nagpur and Ahmedabad

Income tax investigations at Mumbai led to the revelation of a syndicate of ground level operators active in converting banned currency notes into legal tenders for a commission. As part of the operation to nab the culprits, Income Tax Investigation Directorate sent out a few decoy customers seeking to exchange banned currency notes into new notes. The syndicate, acting through its mediator, agreed to the exchange for a 35% commission. The exchange was to take place at the mediator’s residence. The mediator was caught red handed and new currency notes aggregating to Rs. 29.5 lakh was seized.

It has now emerged that the syndicate comprised of many ground level operators (GLOs) - mainly local youths led by a master aggregator and a mediator. The mediator would seek customers. The GLOs would withdraw new currency in their own names or names of friends and family within the prescribed weekly limits, pass it on to the aggregator for a commission and deposit the old notes in their own accounts or accounts of family or friends in small sums.

Another investigation into cash deposits in a bank account in Nagpur revealed that the account holder had no knowledge of the existence of her account where Rs. 3.29 crore had been deposited after 8th November, 2016. Enquiries by the Department revealed 6 more such accounts in her and parents’ names. The 7 accounts were opened and operated by unknown persons to launder cash of Rs. 4.25 crore. Evidences gathered suggest that copies of PAN and other personal documents that she handed over to a friend few years back were used to fraudulently open these accounts in Kolkata, which were operated to channel suspicious funds to 8 beneficiaries, who are now being investigated.

In an interesting case at Ahmedabad, discrete intelligence gathered by the IT investigation team led to a survey at the premises of a transporter in the late hours of 3rd December, 2016. Twenty four cartons in the godown of the transporter meant for transport to Delhi were found. Lorry receipts declared these to contain fire crackers. When the cartons were opened and examined, two cartons were found to conceal currencies in the denomination of Rs.100 aggregating Rs. 27 lakhs. On interrogation, the consigner claimed that the cash was on account of sale of fire crackers being transported to Delhi for purchase of fire crackers. The cash was seized on 5th December, 2016.

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Package for Promotion of Digital and Cashless Economy 08.12.2016

In the aftermath of the cancellation of the legal tender character of old Rs.500 and Rs.1,000 notes, there has been a surge in the digital transactions through use of credit/debit cards and mobile phone applications/e-wallets etc. To further accelerate this process, the Central Government has decided on a package of incentives and measures for promotion of digital and cashless economy in the country. 

These incentives/measures are following: 

1.                  The Central Government Petroleum PSUs shall give incentive by offering a discount at the rate of 0.75% of the sale price to consumers on purchase of petrol/diesel if payment is made through digital means.

Nearly 4.5 crore customers buy petrol or diesel at such petrol pumps per day who can take benefit of this incentive scheme.  It is estimated that petrol/diesel worth Rs.1800 crore is sold per day to the customers out of which nearly 20% was being paid through digital means.  In the month of November 2016 it has increased to 40% and the cash transaction of Rs.360 crore per day have got shifted to cashless transaction methods.  The incentive scheme has the potential of shifting at least 30% more customer to digital means which will further reduce the cash requirement of nearly Rs. 2 lakh crore per year at the petrol pumps.

2.                  To expand digital payment infrastructure in rural areas, the Central Government through NABARD will extend financial support to eligible banks for deployment of 2 POS devices each in 1 Lakh villages with population of less than 10,000.  These POS machines are intended to be deployed at primary cooperative societies/milk societies/agricultural input dealers to facilitate agri-related transactions through digital means.

This will benefit farmers of one lakh village covering a total population of nearly 75 crore who will have facility to transact cashlessly in their villages for their agri needs. 

3.                  The Central Government through NABARD will also support Rural Regional Banks and Cooperative Banks to issue “Rupay Kisan Cards” to 4.32 crore Kisan Credit Card holders to enable them to make digital transactions at POS machines/Micro ATMs/ATMs.

4.                  Railway through its sub urban railway network shall provide incentive by way of discount upto 0.5% to customers for monthly or seasonal tickets from January 1, 2017, if payment is made through digital means.

Nearly 80 lakh passengers use seasonal or monthly ticket on suburban railways, largely in cash, spending worth nearly Rs.2,000 crore per year.  As more and more passengers will shift to digital means the cash requirement may get reduced by Rs.1,000 crore per year in near future.

5.                  All railway passengers buying online ticket shall be given free accidental insurance cover of upto Rs. 10 lakh.

Nearly 14 lakh railway passengers are buying tickets everyday out of which 58% tickets are bought online through digital means.  It is expected that another 20% passengers may shift to digital payment methods of buying railway tickets.  Hence nearly 11 lakh passengers per day will be covered under the accidental insurance scheme.

6.                  For paid services e.g. catering, accommodation, retiring rooms etc. being offered by railways through its affiliated entities/corporations to the passengers, it will provide a discount of 5% for payment of these services through digital means.

All the passengers travelling on railways availing these services may avail the benefit.

7.                  Public sector insurance companies will provide incentive, by way of discount or credit, upto 10% of the premium in general insurance policies and 8% in new life policies of Life Insurance Corporation sold through the customer portals, in case payment is made through digital means.

8.                  The Central Government Departments and Central Public Sector Undertakings will ensure that transactions fee/MDR charges associated with payment through digital means shall not be passed on to the consumers and all such expenses shall be borne by them.  State Governments are being advised that the State Governments and its organizations should also consider to absorb the transaction fee/MDR charges related to digital payment to them and consumer should not be asked to bear it.

9.                  Public sector banks are advised that merchant should not be required to pay more than Rs. 100 per month as monthly rental for PoS terminals/Micro ATMs/mobile POS from the merchants to bring small merchant on board the digital payment eco system.

Nearly 6.5 lakh machines by Public Sector Banks have been issued to merchants who will be benefitted by the lower rentals and promote digital transactions.  With lower rentals, more merchants will install such machines and promote digital transactions. 

10.              No service tax will be charged on digital transaction charges/MDR for transactions upto Rs.2000 per transaction.

11.              For the payment of toll at Toll Plazas on National Highways using RFID card/Fast Tags, a discount of 10% will be available to users in the year 2016-17.