Finance Area Sessions kicked in at around 2:30 with the first speaker Mr. Sanjay Randhar, Managing Director, GVFL. He spoke on the theme “Fintech Revolution”. Fintech is an intersection between technology and financial services. The six major focuses of Fintech Innovation are Payment services, digital lending, savings and investments, remittances, point of sales and insurance. “Vast majority of a billion strong country is left out of the financial system, untouched by financial services that rely mostly on banks. The only way to reach out to them is through Fintech”, he said. He emphasized on the issue that cash payments are still the traditional way that is being used in India while globally, digital transactions have overtaken cash payments. Only 20% Indians are using digital transactions at present. The reasons are low internet penetration, lack of technology, and perceived risk in digital transactions. Growth projections manifest that in 5 years, digital transactions will rise to 60% in India and this will be a tremendous opportunity for Fintech. Factors that will make it feasible are technology, better merchant acceptance network, unified payment interface (UIF) and digital identity like Aadhar card enabled bank accounts. He ended the session by stating: “If you do not nurture brilliant minds, how will new startups come up.”
The second speaker for the finance area was Mr. Manminder Malhi, Vice President, Sales at Kotak Securities. The theme for the session was “Capital Market Instruments, Mutual Funds and Monetary Policy”. He started with the functions of the banking industry which is, on a broad spectrum, a combination of insurance and mutual funds and other regular services. He said, “To counter inflation and financial uncertainties, we must plan and invest our finances wisely. The early you start, the more benefits you get.” He also stated that young generation is the one whose contribution to the economy is largest; therefore, there exists a high dependency of share markets on Gen Y. He criticised the fact that conventionally, we think of fixed deposits and PPFs as the only investment options. Because they only give temporary and small returns which results into losses in the long run. He talked at length about the effects of interest rate, cash reserve ratio and statutory liquidity ratio on the market as a whole. He concluded by elaborating on different unconventional investment avenues available to us and how they can be highly beneficial to us.
The last speaker for the day was Mr. Deepak Prajapati, Executive Director and Group Head at CARE Ratings. The theme for the session was “Burning Issue of NPAs”. He spoke on the non-performing assets in banks and how it has become a major concern over the years. According to him, banks that are good at managing their NPAs do exceptionally well. He also manifested the high credit growth in India and its concurrency with economic growth. He stressed upon the fact that the personal loan segment is growing at a rate higher than the industry loan segment.
NPAs have come out as a major issue because of the stricter RBI norms for the recognition of the non-performing assets. Earlier, banks were reluctant to even acknowledge bad loans. Now, it is evident that NPAs result in lower growth rate and the financial stability report, 2017 proves this fact. The initiatives taken for NPA resolution vary from the establishment of debt recovery tribunal in 1993 to the insolvency and bankruptcy code in 2016 and public sector asset rehabilitation agency (PARA). With this, he ended the thought-provoking session.
Also, Day 1 of Utkrishta 2017 came to an end with these industry experts sharing their knowledge and experience with the students.
This article is contributed by Ayushi Tomar and Meenakshi Pandey-
Media Committee, IMNU