Savings a/c will earn daily interest

Savings bank account can earn you more interest now. The Reserve Bank of India (RBI) has issued a directive in its policy document that will change the way interest is paid on the minimum amount present in a savings bank account each day.At present, the interest (3.5 per cent per annum) is calculated on the minimum balance held in the account from the 10th of each month to the last day of that month. So, if a bank customer has Rs 1 lakh in his savings account one day and then Rs 100 another day, the minimum balance taken for calculation of interest in the period would be Rs 100.

But, from April 1, 2010, the interest paid on the savings account will be on the daily minimum balance. In other words, even the Rs 1 lakh balance in the savings account will earn the customer interest, even if it’s withdrawn later on. As per the new directive issued by RBI, only commercial banks will need to follow this new method of interest payment on savings accounts. Commercial banks include all banks other than co-operative ones.

This means that the money will start earning higher interest even as it remains liquid and safe.

Financial far sight

The ongoing financial crisis in the mature markets abroad has led to much introspection in the domain of policy-making and academia. Products must be made more transparent, with risk mitigation and prudential measures much better aligned. The quality and effectiveness of financial supervision must improve. It follows that the gaps and weaknesses in the prudential norms do need to be properly addressed, with proactive oversight and follow through. The crisis has much to do with the heavy issuance of credit-linked, mostly mortgage-backed, securities in the US, and subsequent large-scale default on the underlying assets, mainly housing.

The fact is that the push for increased sub-prime mortgages earlier this decade followed by securitisation of the receivables greatly compounded the problem.Of the trillions of dollars worth of asset-backed securities issued globally, roughly 60% had AAA credit-rating, the safest possible, according to Fitch Ratings. This is way, way too high. In sharp contrast, less than 1% of corporate bond issues are triple-A rated.

The structured products are particularly default prone in an economic downturn with substantial, correlated risks. It’s clear that the structured products were glaringly faulty. As we. in India moving for more reforms in the financial sector, which includes creating scope for new products, we need much more for skilled human resources and credible supervision . We do need to draw the right lessons from the crisis abroad and implement. Its the far sight that matters!!!!!!!!

5 Indian firms among world's 25 'unsung' innovative cos

As many as five Indian companies like Indian Hotels, footwear firm Bata India have been named in the list of world's 25 'unsung' innovative companies by the BusinessWeek magazine.According to a list compiled by the BusinessWeek 'The world's 25 unsung innovative companies' includes firms which have failed to get a position on the the list of world's most innovative companies but are likely to become household names like Apple, Google in the next 10-20 years.The other three Indian firms on the list are-- Bajaj Holdings & Investment,Godrej Industries and Yes Bank.

Apple, Google, Toyota, and Microsoft--the corporations at the top of this year's Most Innovative Companies ranking are household names the world over. But they wouldn't have all been winners 10 or 20 years ago. The same may be true 10 or 20 years from now," the magazine said.About Indian Hotels, which runs the luxury hotel chain of Taj Hotels & Resorts, the magazine said, "its slick and modern accommodations and attentive service, which it attributes to a merit system that links employee pay to customer satisfaction ratings.

About the footwear retailer Bata India the magazine said, "whether it be canvas sneakers, high heels, or rubber flip-flops, the products are known for their durability and Indian flair.Bajaj Holdings & Investment formerly known as Bajaj Auto, operates through two arms-- financial and investment services, while the other manufactures two-wheeled vehicles. Another Indian firm Godrej Industries which makes and sells bulk chemicals and edible oils has also been named among the unsung list.
About Godrej, the magazine stated that," the company is developing customer-relationship software that will enable buyers to track orders and transactions and receive updates through personalised Web pages.Further, about Yes Bank it stated that bank had carved out a niche in the India by using technology to keep costs low while providing "value added services" to its customers.

Apart from the five Indian entities, Bangladesh's Grameen Bank founded by Nobel Peace Prize winner Muhammad Yunus has also reserved a seat on the list. Interestingly, 97 per cent of Grameen Bank's client are women.

Other companies on the list include Alibaba.com, women's apparel maker Bravissimo, vaccum cleaner firm Dyson Direct, publishing house Future, technology consultancy Grupo Inforges, video entertainment firm Hulu and design consultants Ideo.