Banking Law

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Bank Liability and Provisions Pertaining to Collecting Cheques

 Every day, for some purpose of the other, we use cheques to make payments. The world of banking is one that is fraught with risks that we can barely contemplate. Banks have a privileged position by law to honor the cheques that we issue to third parties. Also, the cheque is made out to another bank that collects the cheque. The Supreme Court has held in several cases that at every step, right from collecting money to making payments, a banker is bound by law to safeguard the rights and obligations flowing from the banker-customer relationship.

India Legal News: RBI Says Banks to Fix Individual Interest Rates

Indian legal news brings you the latest updates about the new rule proposed by the Reserve Bank of India. The apex bank has said that banks shall fix their individual rates of interests for savings deposits. The RBI has also favored the deregulation of interest rates for agriculture sector, EXIM and savings account. Such deregulation is intended to encourage more financial inclusion.

Indian Law: The Purpose of Debt Recovery Tribunals

The Indian government has established Debt Recovery Tribunals, under the Indian law. These were formed to help financial institutes/Banks, to recover their bad debts, in a quick and efficient manner. The recovery of bad loans has turned into a big issue, affecting the profits of banks and government’s revenues too. Debt recovery tribunals are a judicial body, established under the Recovery for Debts Due to Banks and Financial Institutions, Act, 1993.

RBI's Latest Directions

For the latest directions from the Reserve Bank of India on the issuance of Non- Convertible Debentures (NCDs) of original or initial maturity up to one year, please click here.

[The directions have been compiled and shared with us, courtesy S DHANAPAL & ASSOCIATES, Chennai.]

Indian Law Permits Bank to Close Account Without Pan Card Details

The Permanent Account Number (PAN) is allotted to an individual by the Income Tax Department of India. Under the provisions of Indian laws, PAN card is a mandatory requirement, for carrying out any financial transaction.

Concept of Riba in Islamic Banking

One of the principles of Islamic banking is the prohibition of Riba (usury). This is because Islamic banking operates on the basis of Sharia laws of banking that are against the payment and acceptance of interest. In Islam, transactions that involve exchange of money for money must obey Divine Instructions and riba is prohibited in the Quran.

Islamic Banking: Philosophy and Modes of Islamic Banking

Islamic banking refers to banking activities based on the principles and values of Islam and Islamic laws. It is governed by the risk management rules laid down by the Islamic Shariah, which prohibits any unethical transactions. The payment and acceptance of interest-based transaction is strictly prohibited in Islam.  Islamic banking also works by contributing to the attainment of objectives of the respective Islamic economy.

Internet Banking and Indian Laws

Internet banking is a facility that allows a person to access his bank accounts from anywhere, using the Internet. While it offers the benefits of fast transactions, reduced costs and anytime, anywhere facilities, it is also prone to certain hazards. For instance, Internet banking leaves an account holder vulnerable to hacking of personal information.

Online Trading: What are the Nuances of Trade on Internet?

Online Trading: What are the Nuances of Trade on Internet?

Online trading can be defined as the performance of trading activities, such as buying or selling financial securities, currencies and commodities, on the Internet. The foremost requirement for successful online trading is to be patient and use the apt software.

Brokers are not directly involved in the Internet-based investment practice, with most online trading portals providing opportunities for trade with the biggest stock houses, such as NSE and BSE. The total turnover of the online trading industry has shown remarkable growth from a mere 3 percent in 2003-04 to 16 percent in 2006-07.

Consumer Rights Relating to Financial Services in the Banking Sector

The banking sector in India is emerging as a highly competitive field. Smooth banking operations are the life of a nation’s economy. Gone are the days when nationalized banks ruled the way banking operations and services functioned in India. Today, the banking sector in India is dominated by private banks as well. They offer innovation through their banking solutions and financial services so as to attract more and more customers to opt for their services.