Saying yes to Financial Inclusion

I won't be at town for a while, so no blogging this week. So thought of posting this one article published in Business standard. If you remember, I had published an article on Financial Inclusion in one of my earlier blogs (Why be excluded?). Well, banks in India seem to be taking steps towards this direction. Lots of MFI's (Micro Finance Institutions) exist in the market but because of the meagre portfolio they can afford, banks seem to be interested in taking a piece of the pie.

Already, banks like Yes Bank are entering into the foray, with a pilot plant set up in Mumbai. Its Micro Finance wing Sampann, has started operations in 3 areas of Mumbai. It has adopted the strategy of giving loans to individuals directly, instead of Groups of Individuals, as is the case of Grameen Bank.

All said & done, the only limiting factor on banks is that they can keep a variable uinterest rate as long as RBI doesnt put any cap on the interest rate, as explained by Sitaram Rao, consultant to SKS, a micro finance institution.

Frequent defaults could also cause banks unable to keep up with the rest of the business. Alltogether, it also seems as a strategy by banks to offer customers free accounts for taking the facility. The banks anyway gain here, because the risk of default, if nil can earn the bank considerable profit. As I mentioned in one of my blogs on the Inverted Curve. During such a period, banks provide loans for a high interest rate for short periods. This helps the banks in earning huge profits in no time.

Only time will tell how the plan goes. Financial inclusion Zindabaad!!!

Global Financial Crisis-Asian View

I was just browsing through several articles at Business standard thinking what to present to you guys (I was afraid I would run out of topics soon!) when I came across this article by Prof. Shankar Acharya, Honorary Professor at ICRIER Delhi, and Chief economic advisor to the Government of India.

In his article, Prof. Acharya describes about a lecture conducted at ICRIER by noted economist Mr. Andrew Sheng. As rightly explained by Prof. Acharya, the market now is full of articles on the crisis, most of them being works of western economists. But there is few literature available on its affect on the Asian markets. Mr. Sheng's lecture describes about the very historical facts that led to build up the atmosphere for this crisis (Yes, according to Mr. Sheng, it had started as the fires of the previous downturn of 1929 was cleared up).


Click the Link below to read the whole article-

Global Financial Crisis-Asian Perspective

And needless to say, constructive criticism is invited on the article. Do post your comments.

Interim Budget speech 2009

The Interim Budget speech as presented by Hon. Finance Minister Mr. Pranab Mukherjee.

Contributor: Mr. K.P. Nagashrith, BSIM-Bangalore


FM's Budget Speech

Industrial opportunities in North-East India

If I were to be rich,
If I were to be sucessful,
If I were to be grateful,
I would return to this wonderful land,
and give back whatever it had given me
to make me what I am today

It has been a long while since I gave this presentation. Hope that my readers get to know about the industrial scenario of the North-East from this presentation. The document can be downloaded from the following link- http://www.scribd.com/doc/2462921/Industrial-Opportunities-in-the-Northeast

Good Morning North-East

It seems good days are back at the doorsteps of this once forgotten land of ours. Companies seem to have taken a new step in selecting MBA students from far fledged IIM-Shillong, located in Meghalaya, North-East India.

A delighted Director of the new IIM, Prof Ashoke K Dutta said, "When we approached the companies, initially they were hesitant. The challenge was to convince them as to how the products would be of help to them."

It seems being from IIM itself is not an advantage after all. The students as well as the administration have to also position themselves to grab the attention of the Corporates. Proper positioning must also be done to convince the biggies that the students have the basic skills in them to hold back major repercussions during the inverted curve period.

What the North-East needs is to make itself open for more opportunities pour in. Conditions like extremism are still prevalent and fresh in the minds of investors. Companies must convey their message to the people of the North-East that instead of feeling insecure, more opportunities would be coming at their doorsteps.

Let us hope this year ushers in a new spirit of hope to the region.

The New Curriculum

MBA aspirants joining this year & in the future may get to read a lot about the Satyam Scam & the fallen IT Czar Ramalinga Raju.

The question now being debated is whether fresh MBA grads ought to have their attention focussed on such a topic. There are some who feel that MBA's should know a thing or two about business ethics, and keeping that in mind is much more important than earning profits. Others say that such cases should be left to students doing CA courses and law firms as they are more involved directly in such cases.

According to me, a businessman needs to be aware of all his surroundings. People would think twice before they do something foolish or the other.

An MBA grad should know what has to be followed. There are many ways a company can earn its profits. Proper management happens when you take the right path of earning this profit. India is already dependent on FDI's & FII's on maintaining its stock market movement. Any similar mishap can make such investors loose their confidence in the Indian business environment, ultimately leading to more disaster.

Let us hope that there wont be another 'Enron' or 'Satyam' for us to study.

Eureka! That's Finance

Students like me from B.Sc background have had really hard times in and out of class coping with Finance subjects. Following are tips from a few lessons that I learnt-

1. Be in touch with your professor- Some are tough, I know, but they also know your weakness well. Ask them where you lack.

2. Get one good book & stick to it- Its true that in specializations, you have to read a lot, but often with so many books lying around, you might end up deciding which one to start. Understand it...then go for change.

3. The Job- Don't visualise yourself 2 years from now working on your PC doing some unknown research. Search the job postings available at different job sites like 'Naukri' & Monster.com. Find out what these jobs involve. Select your field of choice & work towards it. Believe me....you dont get to sit in the hot seat right away.

4. Everyday is a new day- So learn something new. There are analysis tools from excel. Dont wait for others to teeach you. The materials are available on net. And dont think you can get it done in a day.

5. Freelance- Get hold of a company of your choice. Dont just take the top ones. Take one that's faring very badly. Use your analytics that you learnt as Science Grads. Think what could have gone wrong. Do a short analysis and show it to your professors. This excercise would increase your confidence level and your proactiveness.

Do share any other tips or comments that you might have. Happy Calculating!!!

Thats how Mao's cookie crumbled!!!

You pick up your favourite toy you used while you were a kid when you notice that familiar yet unwanted tag- 'Made in China'.

One of the reasons why Chinese goods are preferred lies behind the way the Chinese currency Renminbi or more popularly called 'Yuan' is evaluated.

You see, currencies like Indian Rupee, American Dollar, GBP (Great British Pound) are traded openly in a separate market (also called as forex). This trading happens as long as each unit of currency holds a certain value against some other currency and this value keeps on changing.

I remember when I changed my Binocular with my brother for his geometry box (which I badly needed!). For my bro (who was 7 years old), Binoculars were like heaven. So he gave in.

That's whats happening with currencies. They trade when they hold value.

Now, in the last decade, for 1$ you could get 8.28 Yuan of work done! So as a company in US, I send more $'s into China. But later, in 2005, China valued Yuan to 8.11 Yuan/$. Now I am only able to get 8.11 Yuan of work done by my Chinese friends for my precious 1 $. It is at this point that I start focusing more on quality. I now start looking at countries which offer more quality goods.

What are all those traders shouting about?!?!?!

Ever wondered what the stock market is about. The following is just an example of what is speculation in the stock exchange!!!

It was autumn, and the Red Indians asked their New Chief if the winter was going to be cold or mild. Since he was a Red Indian chief in a modern society, he couldn't tell what the weather was going to be..

Nevertheless, to be on the safe side, he replied to his Tribe that the winter was indeed going to be cold and that the members of the village should collect wood to be prepared.

But also being a practical leader, after several days he got an idea. He went to the phone booth, called the National Weather Service and asked "Is the coming winter going to be cold?" "It looks like this winter is going to be quite cold indeed," the weather man Responded.

So the Chief went back to his people and told them to collect even more wood. A week later, he called the National Weather Service again. "Is it going to be a very cold winter?" "Yes," the man at National Weather Service again replied, "It's definitely going to be a very cold winter."

The Chief again went back to his people and ordered them to collect every scrap of wood they could find. Two weeks later, he called the National Weather Service again.
"Are you absolutely sure that the winter is going to be very cold?" "Absolutely, " The Man replied. "It's going to be one of the coldest winters ever."

"How can you be so sure?" the Chief asked. The weatherman replied, "The Red Indians are collecting wood like Crazy."

This is how stock market works!!!

Hi to all!!!

One more blogger you may say. Just created my first blog site. I am a student of finance and was wondering that it would be nice to have something for people who want to know finance, but in the language that they want to. So here I am. I wont say that I am the best. But hope to make a mark.
I would like to take this opportunity to thank fellow blogger Vamshi Krishna (www.consumerpsyche.blogspot.com) who inspired me to come forward.