ISIN or International Securities Identification Number is a 12 character alpha-numeric code that uniquely identifies a security, across the world. The securities include shares, bonds, warrants etc. For example, the ISIN of Bharti Airtel is INE397D01024.
ISIN constitutes of three parts. It starts with a two letter country code. In the case of Bharti Airtel the country code is IN (India). The country code is according to the ‘ISO 3166-1 alpha-2’ standard.
The country code is followed by a nine character alpha-numeric national security identification code assigned to a security by the governing bodies in each country. In the case of Bharti Airtel, the national security identification code is ‘E397D0102’. This is followed by a single character check digit, which will validate the ISIN code. The detail of how this validation is done is illustrated here.
In a time when security trading across countries has become rampant, having a unique identifier for a security greatly helps traders as well as brokers in various countries to unambiguously identify and trade a security.
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Showing posts with label Deposits. Show all posts
Showing posts with label Deposits. Show all posts
Monday, 14 June 2010
Wednesday, 15 April 2009
What makes Swiss Bank Accounts safe and secure?
Recently, discussions about Swiss Bank Accounts came into prominence in Indian media further to the revelation that Indian nationals have a whopping 1456 billion US dollars in Swiss Bank accounts. This means Indians have more money in Swiss Bank Accounts than the rest of the world combined. Leaving aside this story, let’s concentrate on Swiss Bank Accounts and what makes them safe and secure.
In many novels and films, we have seen intriguing stories associated with Swiss Bank Accounts, like in Bourne Identity, Da Vinci Code etc. Even though most of these actually don’t happen in a Swiss Bank Account, lots of people consider Switzerland to be a place where they can keep their money safe and secure. There are a few factors that make it so.
The Banking Act of 1934 was passed in Switzerland to prevent Swiss Banks from divulging depositor information to other countries during world war period, with which those countries tried to confiscate the assets owned by the customers of Swiss Banks, especially the Jews, in the name of “the good of state”. But then the Act stayed on and provided enough privacy to depositors of Swiss Bank Accounts.
Switzerland is a very stable country and it maintains a policy of neutrality with other countries. It maintained neutrality in both World Wars, is not a member of the European Union and was not even a member of the United Nations until 2002. That’s why many of the world organizations have their headquarters in Switzerland. Thus the country doesn’t have a need to succumb to pressures from international treaties and obligations. All these make its economy robust and the banking system highly stable.
Also, Switzerland is a tax haven for depositors of other countries. For nonresident depositors of Switzerland there are no taxes if they don’t reside in EU or don’t invest in Swiss companies, making it a promising place to put their money in.
Good Reads
- How Swiss Bank Accounts Work?
In many novels and films, we have seen intriguing stories associated with Swiss Bank Accounts, like in Bourne Identity, Da Vinci Code etc. Even though most of these actually don’t happen in a Swiss Bank Account, lots of people consider Switzerland to be a place where they can keep their money safe and secure. There are a few factors that make it so.
The Banking Act of 1934 was passed in Switzerland to prevent Swiss Banks from divulging depositor information to other countries during world war period, with which those countries tried to confiscate the assets owned by the customers of Swiss Banks, especially the Jews, in the name of “the good of state”. But then the Act stayed on and provided enough privacy to depositors of Swiss Bank Accounts.
Switzerland is a very stable country and it maintains a policy of neutrality with other countries. It maintained neutrality in both World Wars, is not a member of the European Union and was not even a member of the United Nations until 2002. That’s why many of the world organizations have their headquarters in Switzerland. Thus the country doesn’t have a need to succumb to pressures from international treaties and obligations. All these make its economy robust and the banking system highly stable.
Also, Switzerland is a tax haven for depositors of other countries. For nonresident depositors of Switzerland there are no taxes if they don’t reside in EU or don’t invest in Swiss companies, making it a promising place to put their money in.
Good Reads
- How Swiss Bank Accounts Work?
Wednesday, 25 February 2009
Is Average Quarterly Balance Fine ripping us off?
In India, most of the private sector banks charge a hefty fine on their customers for not maintaining the required Average Quarterly Balance (AQB) amount in their savings accounts. When the AQB itself is quite high at 10,000 rupees for most of the private banks, the fine comes to more than 800 rupees (including surcharge) and is not a small amount by any means.
To have a comparison with other countries, in Singapore, the amount banks generally charge for not maintaining the monthly average balance is 2 Singapore Dollars, which comes to around 65 Indian Rupees. And that means the AQB fine banks charge in India is 12 times that of in Singapore!!
With the AQB amount made double that of what it was previously, the probability of a person defaulting on it also increases. And when the fine is levied on a huge number of customers, it results in tremendous income for the banks, probably what they are eying at.
I guess it’s high time that the Reserve Bank of India intervenes and put an end to this day time robbery, like it put a cap on ATM withdrawal fee a year back.
In the mean time, what we can do is,
1. Have less number of savings accounts as possible with private banks
2. Move your savings accounts to nationalized banks, that have lower AQB and charge less default fee
Meanwhile, this link shows how the average quarterly balance is calculated by banks.
Related Articles
- What is a Core Banking System?
- Online money transfer to India for NRIs
- Avoid owning multiple savings bank accounts
- Interest rate on credit cards to increase to 49%
To have a comparison with other countries, in Singapore, the amount banks generally charge for not maintaining the monthly average balance is 2 Singapore Dollars, which comes to around 65 Indian Rupees. And that means the AQB fine banks charge in India is 12 times that of in Singapore!!
With the AQB amount made double that of what it was previously, the probability of a person defaulting on it also increases. And when the fine is levied on a huge number of customers, it results in tremendous income for the banks, probably what they are eying at.
I guess it’s high time that the Reserve Bank of India intervenes and put an end to this day time robbery, like it put a cap on ATM withdrawal fee a year back.
In the mean time, what we can do is,
1. Have less number of savings accounts as possible with private banks
2. Move your savings accounts to nationalized banks, that have lower AQB and charge less default fee
Meanwhile, this link shows how the average quarterly balance is calculated by banks.
Related Articles
- What is a Core Banking System?
- Online money transfer to India for NRIs
- Avoid owning multiple savings bank accounts
- Interest rate on credit cards to increase to 49%
Wednesday, 11 February 2009
Avoid owning multiple savings bank accounts
A large number of people own savings accounts in several banks. Some are inherited from their previous jobs while some are opened to avoid tax deduction at source on fixed deposits. As the minimum average quarterly balance required to maintain these savings accounts increases in private sector banks, owing multiple savings accounts become a costly affair.
An increasing number of banks have hiked the average quarterly balance (AQB) in metros to Rs. 10,000; while most of them have the minimum AQB amount as Rs. 5000 in smaller cities. Thus, a lot of customer’s money is blocked to keep their savings accounts alive. For example, consider the case of a person having 5 savings accounts of AQB Rs. 10,000 each!
Secondly, having too many savings accounts and the need to maintain minimum AQB in each one of them pose the danger of not being able to meet the minimum AQB in one or two accounts, which leads to penalty charges. This is usually a huge amount in private sector banks (ICICI Bank charges Rs. 750 + Service Charge) as a penalty for not maintaining minimum AQB.
But above all, earning a paltry interest rate of 3.5% for your money in savings account, when you can earn a much higher interest of around 10% in Fixed Deposits, would not be a great idea. That is, if you have less number of savings accounts, less would be the money needed for maintaining minimum AQB in those and more would be the money available for Fixed Deposits.
“If you notice that your savings account balance is over Rs 50,000, normally you would think of transferring some money to a fixed deposit. But if there is Rs 20,000 in multiple accounts, the thought many not cross your mind”, says a financial advisor, which is very true. So it’s better to own as less savings accounts as possible.
An increasing number of banks have hiked the average quarterly balance (AQB) in metros to Rs. 10,000; while most of them have the minimum AQB amount as Rs. 5000 in smaller cities. Thus, a lot of customer’s money is blocked to keep their savings accounts alive. For example, consider the case of a person having 5 savings accounts of AQB Rs. 10,000 each!
Secondly, having too many savings accounts and the need to maintain minimum AQB in each one of them pose the danger of not being able to meet the minimum AQB in one or two accounts, which leads to penalty charges. This is usually a huge amount in private sector banks (ICICI Bank charges Rs. 750 + Service Charge) as a penalty for not maintaining minimum AQB.
But above all, earning a paltry interest rate of 3.5% for your money in savings account, when you can earn a much higher interest of around 10% in Fixed Deposits, would not be a great idea. That is, if you have less number of savings accounts, less would be the money needed for maintaining minimum AQB in those and more would be the money available for Fixed Deposits.
“If you notice that your savings account balance is over Rs 50,000, normally you would think of transferring some money to a fixed deposit. But if there is Rs 20,000 in multiple accounts, the thought many not cross your mind”, says a financial advisor, which is very true. So it’s better to own as less savings accounts as possible.
Sunday, 1 February 2009
Rise in NRI remittances to India
Despite economic recession, Indians working abroad had sent a record $40 billion as remittances to India in just 9 months of calendar year 2008. As the last quarter is a festival period, the total remittances for the year may even exceed $50 billion. This would be way ahead of World Bank’s prediction of $30 billion for India in 2008.
In 2007, with $27 billion as remittances, India was placed as the number one recipient of inward remittances globally by World Bank, with China in close second ($25.7 billion). And the story would be no different this year as well.
Inward remittances (unlike FII) are considered ‘sticky’ as this money is sent to India primarily for savings and family spending, and hence would remain in the economy. Thus it plays a major part in boosting the economy, in particular, during the ongoing recession. Hence, as a policy measure, government is also promoting NRI remittances through higher interest rates on NRI deposits. This could offset the FII outflow to some extent and thus could reduce the dependence of the economy on FII money.
Even though the recession is progressing, remittances had not/may not fall due to the following reasons.
1. The fear of job loss forces people to save more, especially in the safer Indian financial markets
2. Rise in rupee dollar exchange rate would fetch more rupee than ever when transferred to India
3. Rise in interest rates of FCNR and NRE deposits
More details here.
Related Articles
- Online money transfer to India for NRIs
In 2007, with $27 billion as remittances, India was placed as the number one recipient of inward remittances globally by World Bank, with China in close second ($25.7 billion). And the story would be no different this year as well.
Inward remittances (unlike FII) are considered ‘sticky’ as this money is sent to India primarily for savings and family spending, and hence would remain in the economy. Thus it plays a major part in boosting the economy, in particular, during the ongoing recession. Hence, as a policy measure, government is also promoting NRI remittances through higher interest rates on NRI deposits. This could offset the FII outflow to some extent and thus could reduce the dependence of the economy on FII money.
Even though the recession is progressing, remittances had not/may not fall due to the following reasons.
1. The fear of job loss forces people to save more, especially in the safer Indian financial markets
2. Rise in rupee dollar exchange rate would fetch more rupee than ever when transferred to India
3. Rise in interest rates of FCNR and NRE deposits
More details here.
Related Articles
- Online money transfer to India for NRIs
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