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Rise of Online Loan Lending Platforms

Online money lending

With the evolution in the field of information technology, the lifestyle of people started changing gradually. It started showing its effect on various sectors and one of them is banking and finance sector. Before the evolution, the process of completing a financial transaction was tough and physical presence of both person (borrower and lender) was must. But nowadays everything has changed even the way of money is being borrowed has changed by online lending platforms. One can easily borrow a sum of loan/money from the lender without knowing each other or meeting each other. The transactions are carried out in short time period with the help of information technology.

How it all started?

Lending has existed for thousands of years and has taken on many different forms throughout. At the very end of the 20th Century, First Internet Bank emerged. Consumers could apply for an online loan from their home or office computer, and they didn’t actually have to visit a bank or speak with a loan official. The number of start-ups in the online consumer lending space has grown significantly from a mere 2 in 2013 to 30 in 2015. These firms either operate as NBFCs, intermediaries for banks/NBFCs or serve as a P2P lending marketplace. People conduct all kinds of business transactions online that they used to perform in person. This includes shopping, paying bills, researching business decisions, and of course, applying for loans. As both consumers and business owners grow more comfortable with conducting business over the internet, online lending is also expected to continue to grow.

Today, online money lending is in full swing and only getting bigger day by day with lakhs for transactions and crores of the loan being distributed per month.

How one may lend money online?

The process of lending short term loan online is quite easy. It is divided into the 4 simple steps as shown

Lending Process

For instant loan the borrower needs to apply online, once the lender receives an application they will check for eligibility and approves/dis-approves the application. Once the application is approved the disbursement of the loan takes place.

These online platforms work more like a bank. When a person applies for a personal loan online there is evaluation of creditworthiness and repayment capacity of an individual. The only difference between banks and the online lending platforms is that there will be no executive visiting to collect the documents and provide other services A borrower needs to scan and upload documents for KYC, such as photo, PAN card, Aadhar card and passport. Then, they need to provide income-related documents such as six months’ bank statement, three months salary slip and income tax returns.

We are one of them

We all have gone through the situations where we are left with empty pockets and being broke at the end of the month is a common problem.

We at EarlySalary.com offer quick short term loans to salaried individuals. We plan to help provide a small bridge loan to tide over that short difficult period till your salary reaches your account. The process of applying for a loan on EarlySalary is very simple. It is consisting of three easy steps. The first step is that one needs to log in and apply for the loan after which loan request will be approved or rejected (depends upon credit worthiness) and at last as soon as the request is approved the cash will be transferred into your account immediately.

Sounds good? Let’s try it out here and get your salary in advance with EarlySalary.  
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Calculation of Tax

Getting a salary is a wonderful feeling. It makes you feel rewarded for all the hours of dedicated work that you put in. But the happiness fades away when a large chunk of your hardearned income gets converted into tax. It is essential to figure out how you can avoid that high deduction in tax.

Income

The components that make up your salary include your Gross salary, Provident Fund, Insurance, Leave pay, Gratuity Employee State insurance and Labour Welfare Fund This income that is reveived by an employee is taxed under “Income from Salaries”.

You need to find out the slab that your salary will pertain to. After figuring that out, you need to be prompt in declaring your investments. This allows the employer to take into consideration the portion of your earnings that you have invested and he/she will accordingly deduct tax from your salary.

Declaration helps you to avoid the cumbersome process of filing for refunds from the Income Tax department.

Tax Calculation

Taxes are calculated on the annual income of a person, and an annual cycle (year) in the eyes of the Income Tax law starts on the 1st of April and ends on the 31st of March of the next calendar year. The law recognizes and classifies the year as “Previous Year” and “Assessment Year”.

Income Tax Slab Rates:

Income tax slab rates are for different categories of taxpayers, who are taxed progressively higher based on their earning.
On all the tables listed below, Education Cess of 2% and SHEC of 1% will be levied on the tax computed using the rates given below.
Under Section 87(A), an Income Tax Rebate of Rs.2,000 is provided for all individuals earning an income that’s less than Rs.5,00,000 per annum.
Income Tax Slabs for male individuals below the age of 60 and HUF:

Income Tax Slabs Income Tax Rates
Total income less than Rs.2,50,000. -NIL-
Total income greater than Rs.2,50,000 but less than Rs.5,00,000. 5% of the amount by which it exceeds Rs.2,50,000.
Total income greater than Rs.5,00,000 but less than Rs.10,00,000. 20% of the amount by which it exceeds Rs.5,00,000.
Total income greater than Rs.10,00,000. 30% of the amount by which it exceeds Rs.10,00,000.

Income Tax Slabs for female individuals below the age of 60:

Income Tax Slabs Income Tax Rates
Total income less than Rs.2,50,000. -NIL-
Total income greater than Rs.2,50,000 but less than Rs.5,00,000. 5% of the amount by which it exceeds Rs.2,50,000.
Total income greater than Rs.5,00,000 but less than Rs.10,00,000. 20% of the amount by which it exceeds Rs.5,00,000.
Total income greater than Rs.10,00,000. 30% of the amount by which it exceeds Rs.10,00,000.

Income Tax Slabs for all individuals above the age of 60 – Senior Citizens:

Income Tax Slabs Income Tax Rates
Total income less than Rs.3,00,000. -NIL-
Total income greater than Rs.3,00,000 but less than Rs.5,00,000. 10% of the amount by which it exceeds Rs.3,00,000.
Total income greater than Rs.5,00,000 but less than Rs.10,00,000. 20% of the amount by which it exceeds Rs.5,00,000.
Total income greater than Rs.10,00,000. 30% of the amount by which it exceeds Rs.10,00,000.

Income Tax Slabs for all individuals above the age of 80 – Super Senior Citizens:

Income Tax Slabs Income Tax Rates
Total income less than Rs.5,00,000. -NIL-
Total income greater than Rs.5,00,000 but less than Rs.10,00,000. 20% of the amount by which it exceeds Rs.5,00,000.
Total income greater than Rs.10,00,000. 30% of the amount by which it exceeds Rs.10,00,000.

Deductions: There are various sections under which you can invest your salary and reduce the taxable amount.

Deductions for your taxable amount are available under various sections of the Income Tax act 1961. They are as follows: –

1. Public Provident Fund (PPF):
By contributing to your PPF account, you can get tax deduction under Section 80C, the Indian Income Tax Act, 1961.

2. Life Insurance Premiums:
You can get income tax deduction for paying premium towards life insurance policies for self, spouse and child under section 80C of the Indian Income Tax Act, 1961. The amount received on maturity of the policy is free from tax. However, it is subject to the terms and conditions mentioned in your policy.

3. National Saving Certificate (NSC):
The amount invested in NSC is eligible for tax deduction under section 80C of the Indian Income Tax Act, 1961. National Saving Certificates is one of the highly secured modes of investments in India. But, the interest earned from NSC is taxable. As an NSC is a cumulative scheme, interest is reinvested and qualifies for tax deduction.

4. Bank Fixed Deposits (FDs):
You can get tax deduction by investing in fixed deposits for a tenure of 5 years, under section 80C of the Indian Income Tax Act, 1961. Many banks in India offer tax saving fixed deposits. However, the interest accrued on FDs is subject to tax

5. Senior Citizen Savings Scheme (SCSS):
Senior citizens can get tax deduction by investing in Senior Citizen Savings Scheme offered by banks. These schemes are eligible for tax deduction under Section 80C of the same act. The interest earned from these schemes is entirely taxable.

6. Post Office Time Deposit (POTD):
Investing in a five-year POTD, you can get tax deduction under Section 80C. However, interest accrued on the same is fully taxable.

7. Unit-linked Insurance Plans (ULIP):
Investing in ULIPs for yourself, spouse and your children, you can get tax deductions under Section 80C.

8. Home Loan EMIs:
Equated monthly installments paid to repay the principal amount of your home loan are eligible for income tax deductions under section 80C of the same act.

9. Mutual Funds & ELSS:
Investing in mutual funds and equity-linked savings scheme, you are eligible for tax deductions under section 80C, the Indian Income Tax Act, 1961.

10. Stamp Duty and Registration Charges for a Home:
Stamp duty and registration fee paid for transferring property are entitled for income tax deduction under section 80C, the Indian Income Tax Act, 1961.

11. Retirement Savings Plan:
You can also get income tax deductions by investing in retirement plans offered by LIC or other insurance providers. Contribution to the National Pension Scheme is also eligible for tax deduction.

12. Tuition Fees:
Tuition fee paid for your children’s education qualifies for income tax deduction under section 80C. However, the fee needs to be paid for full-time education in an Indian university, college and school for any two children. Tuition fee does not include any donations or development fee towards education institutions.

13. Medical Insurance Premiums:
Health insurance premium paid for self, spouse and children qualifies for income tax deduction under section 80D of the Indian income Tax Act, 1961. The deduction allowed under this section is Rs. 25,000 for youngsters and Rs. 30,000 for senior citizens.

14. Infrastructure Bonds:
Investing in infrastructure bonds, you become eligible for income tax deductions under section 80CCF of the Indian Income Tax Act.

15. Charitable Contribution:
Donating for charitable tasks will help you reduce your taxable income under section 80G of the Indian Income Tax Act, 1961. However, make sure that you declare the whole contribution before 31st December each year.

16. Treatment of Disabled Dependents:
Under section 80DD of the Indian Income Tax Act, 1961, you can get income tax deductions for medical expense incurred in the treatment of any disabled dependent of yours.

17. Deduction for Preventive Health Check-ups:
An amount of Rs.5000 spent for preventive health check-ups of an individual or his/her family members qualifies for tax deduction under section 80D of the Indian Income Tax Act, 1961.

18. Interest Paid on Education Loan:
You can get tax deduction on the interest paid for an educational loan under section 80E of the Indian Income Tax Act, 1961. The loan can be taken to pursue higher education by the employee, or for his/her spouse, children or a student to whom the employee is a legal guardian.

19. Deduction on House Rent Paid:
An employee can get income tax deduction for the house rent paid, if the employee or his/her spouse does not own residential accommodation at the place of employment. This deduction is usually applicable for salaried taxpayers under section 80GG of the Indian Income Tax Act, 1961.

Income Tax E-Filing:
Once tax is deducted, any tax refund is facilitated only when you submit your income tax return for that year. So any TDS on rent payments for NRIs, or TDS deduction by banks on your fixed deposits will be refunded only once you file your tax returns and claim the desired tax deduction. You will need to file for tax refunds online once you file your ITR for that year.

You can e-file your Income Tax Return, TDS return, AIR return and Wealth Tax Return online ,E-filing your return has obvious advantages like the fact that you won’t have to deal with the hassle of paperwork and waste time sorting through it all. You can simply log on to the secure website and e-file your return.

Hope this article gives you a clear picture of how taxes are deducted from your salary and how you can take the measures to reduce your taxable income.

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Overdraft Facility

What is meant by Overdraft facility?

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Overdraft facility is a credit line that is sanctioned to an individual against their assets. For example, you can mortgage your house with a bank and get a loan amount sanctioned against it.

If your house is worth 1 crore, then the bank might sanction you a loan of 50 lakhs after evaluating your repayment capabilities.

Why is there a need of an Overdraft Facility?

There are situations in life where in even the money saved for emergencies is not sufficient and this may lead to individuals in a dilemma. A lot of people keep 3months to 6months of expense aside on being advised by their financial consultants, however this might not be handy when there is an urgent need of cash.

This is where Overdraft facility comes in. Overdraft facility is a great way to raise funds for short-term if used wisely.

Usage of the overdraft money

The money is not disbursed immediately. You can keep withdrawing money from this overdraft account. It works similar to an approved personal loan. The interest will be charged from the day you borrow the loan. You can keep on borrowing and repaying it till the bank allows you to do so. The interest charged is 12-14 percent per year.

Assets that can be used as mortgage

Following can be offered to banks as assets: –
  • Insurance polices
  • Fixed Deposits
  • Shares
  • Bonds
The rate of interest varies for different collaterals.

The process

The process is similar to taking any other loan. You can offer a variety of collaterals to bank against your loan. There are pros and cons associated with different kinds of collaterals that you might offer. For example taking an overdraft against a property gives you a larger line of credit, however the time to evaluate is large. In case of fixed deposits as collaterals the process is much faster. Similarly the returns for life insurance properties are not good.

Depending upon the collateral, you should choose the limit. There is also a fee with a cap of 0.5 to 1 % charged while an overdraft is being granted.

Should one go for an Overdraft facility?

Overdraft facility is meant for disciplined individuals. If you use it for short-term trading in stocks, commodities etc, it may backfire. If you lose in these risk oriented measures, then you will have to pay the entire amount along with the interest incurred. Also if you fail to do so, then the collateral is liquidated. So choose very carefully.

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Celebrating Valentine’s Day with Early Salary

Valentine-blog

It’s the time of the year when promises are made new beginnings are carved, and bonds are strengthened.

It is the Valentine’s week. This is the week where people express their love for each other. This is the time when people exchange gifts with each other to showcase their affection.

However often we find ourselves in a state where our finances dwindle, and we are not able to fulfill our desires.

It is sad to acknowledge the fact that the most romantic day is approaching and we are low on cash. This makes us feel helpless and stressed. We even go in a state where we do not see the point in celebrating the day.

But EarlySalary never wants the lovebirds to miss out on such a day. We would want people to enjoy the day to it’s fullest without having to worry about cash.

With EarlySalary’s instant cash option, you can avail money whenever you want.

We would want you to cherish this day and make the most of it.

And not just the day of Valentine, EarlySalary would even suggest you to be the Earlybird where you get something unique for your loved one in the week prior to Valentine’s day.

Presents are always overwhelming, but they are even more endearing when given to people at the time when they are least expecting it.

With EarlySalary’s cash option, you can make Valentine’s day special in various ways. We can suggest some to give you a slight idea!

  • You can take your better half on a dinner date and celebrate the occasion in the grandest of days.
  • You can plan a holiday for your loved one, and travel to explore and experience
  • Valentine’s day falling on a weekday should not deter you in celebrating elaborately. You can make the weekday better than the weekend and paint the town red! You can take her out to the grooviest club and dance the night away!
  • You can get them something unique that will cause them to smile like never before
  • You can fill their wardrobes with the latest clothing and accessories
  • You can plan a weekend getaway for them away from the hustle and bustle of city life

We strongly believe that you all have a creative head and you can implement this Valentine’s day in the most special way for your loved one. EarlySalary’s always there as a friend when you need it!

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Personal Loans

>What are Personal Loans?

Pr Personal loans are a category of loans that one can borrow from financial instruments available. These loans can be used for a variety of purposes such as renovation of home, repayment of debts, unexpected expenditure etc. However we must note that personal loans are not easy to obtain, and there are certain qualifications that one needs to have to get approved for a personal loan.

Below are certain points that you can pay heed to if you are considering to go for a personal loan.

Personal loans are unsecured.

This essentially means that in this case no asset or collateral is required as opposed to secured loans. Hence defaulting on personal loans means that the lender cannot set aside any property or mortgage against the loan. This is one of the major reasons for the difficulty in accessing personal loans. However the lender does have other actions to take. This includes reporting to the credit bureaus, having a collection agency or filing legal procedures for the same.

Personal loans have a fixed amount.

The amount that you can take as a loan is fixed in case of a personal loan. The amount fixed depends upon various factors such as the borrower’s income, credit rating etc. The borrower with a better credit score and a higher income can borrow a higher sum of money.

Interest rates for personal loans are calculated according to the customer’s salary

The interest rate is allocated according to the customer’s salary, the amount being borrowed, loan tenure and other criteria that differ from one lender to another.

Personal loans a fixed repayment period.

The repayment time period is fixed and ranges from 1 to 5 years.

Types of Personal loans offered by financial instruments

  • • Personal Loan For Low CIBIL Score (Not easy to get)
  • • Business Startup Loan (For SME and Start-ups)
  • • Same day loans( For people with cash emergencies)
  • • Loans for the unemployed
  • • Govt. Loans for Small Scale Businesses( For small scale business)
  • • Small Business Loans for Women
  • • Corporate Loan (For existing businesses or industrial houses) • Home Improvement Loan
  • • Medical loan
  • • Marriage Loan

Personal loans affect your credit score.

There is no collateral for personal loans; however defaulting on a personal loan can affect your CIBIL score. However, everything from applying for a loan (which means a new inquiry on your credit report) to how timely you make payments will affect your credit. The key to maintaining a good credit score is making your loan payments on time each month.

EarlySalary here is a great option for individuals to get quick access to instant cash without any hassles involved. The personal loans are approved in a matter of just 10 minutes.

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What is the Right Way for the Twenty Something’s To Spend Money

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When you are in your twenty’s, you get perpetual recitations on money saving and management This indeed is a great thing, because an advise like this is always treasure worthy.

However apart from managing finances and saving money, it is also crucial to master the art of spending right. Let’s discuss about where you should be spending your money.

Health Insurance

Health is something that should be kept on top priority. You might not want to think about health when you are young, but health insurance is one of the things 20-somethings should spend their money on. While being a student you maybe covered under your parent’s health plan. However beyond that stage, you need to invest in order to be better prepared when an emergency strikes.
Medical bills are scary, especially when they get piled up. So it is imperative to sort out these finances in order to escape the last moment distraught.
From personal experience, one trip to the emergency room can cost thousands of dollars, which can easily deplete your savings account.
Even if you can’t afford the best coverage, some coverage is better than none.

Life Insurance

There are various life insurance policies to opt for in india.
Life insurance is relatively cheap if you’re a young adult with no major health problems.
If you’re single with no dependents, you may feel life insurance is unnecessary at this point in your life. However, a policy can pay off your debts.
Plus, the death benefit can cover your funeral and burial, taking the financial burden off your family.

CIBIL Monitoring

You should monitor credit report once in a year. This helps in keeping a check on your credit scores.
Even if you do not have a credit history or a long credit history, it is imperative to stay on top of your report. Erroneous credit has many implications on future loan requests and applications.
You can evaluate your credit once on CIBIL by paying Rs 550. Then there are different plans that you can take to monitor your account at regular intervals.

Building a retirement account

Retirement is a far-fetched idea. Thinking about retirement is one of your least priorities.
However money grows exponentially if you start investing at the right time. This would create a very comfortable and at ease retirement phase for you.
For retirement plans check our blog http://earlysalary.com/planning-for-retirement/

Investing in property

Most of you twenty-something’s would not think of buying a home. A rented space is what you need at this stage.
However with approaching stability and firm finances, thinking of investing in property is a great step indeed. This helps in safeguarding your future
You can build equity, and when you’re ready to sell your starter home, you can put the proceeds down on a nicer place..

Investing in reliable and cost-effective vehicles

It is a sensible decision when you choose to buy a vehicle that is both reliable and cost-effective.
You need to avoid buying new used cars, or stop dealing with numerous repairs that drain your pocket. A wiser decision is to purchase a newer model car that requires optimum maintenance. You can pay off the loan for the car gradually.
Money can be employed in various ways. But the best ways are something that you need to seek out. This helps in planning your present and future in a much better fashion.

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Banking Sector

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The Indian banking sector has its roots in the 18th century, and has evolved in a variety of ways since then Post-Independence, The Reserve Bank of India, India’s central banking authority, was established in April 1935, but was nationalised on 1 January 1949 under the terms of the Reserve Bank of India (Transfer to Public Ownership) Act, 1948 (RBI, 2005b).]In 1949, the Banking Regulation Act was enacted, which empowered the Reserve Bank of India (RBI) to regulate, control, and inspect the banks in India.The Banking Regulation Act also provided that no new bank or branch of an existing bank could be opened without a license from the RBI, and no two banks could have common directors.

During the Nationalisation in 1960’s, Inspite of the offerings, authorities and regulations of the Reserve Bank of India, banks in India except the State Bank of India (SBI), remained owned and operated by private persons. By the 1960s, the Indian banking industry had become an important tool to facilitate the development of the Indian economy.

Second Round of nationalisation of six more commercial banks ensued in 1980. This gave more control to the Indian Government, and it regulated 91% of the banking business in India.

In the year 1993, Government merged New Bank of India and Punjab National Bank rendering reduction in nationalized banks from twenty to nineteen.

Liberaisation in the early 1990’s lead to licensing few private banks. These financial instruments came to be known as New Generation tech-savvy banks that included ICICI Bank, HDFC bank, Oriental bank of commerce, Axis bank etc. This led to a surge in the growth of economical conditions of India, fuelled by government, private and foreign banks.

The next stage for the Indian banking has been set up, with proposed relaxation of norms for foreign direct investment.

The new policy shook the Banking sector in India completely and led to a retail boom. Also with the advent of Information technology in this era, online banking and ATM’s became popular and grew substantially in the coming years

Currently,
The Indian banking sector is broadly classified into scheduled banks and non-scheduled banks. All banks included in the Second Schedule to the Reserve Bank of India Act, 1934 are Scheduled Banks. These banks comprise Scheduled Commercial Banks and Scheduled Co-operative Banks. Scheduled Co-operative Banks consist of Scheduled State Co-operative Banks and Scheduled Urban Cooperative Banks.Scheduled Commercial Banks in India are categorised into five different groups according to their ownership and/or nature of operation:
• State Bank of India and its Associates
• Nationalised Banks
• Private Sector Banks
• Foreign Banks
• Regional Rural Banks.
In the bank group-wise classification, IDBI Bank Ltd. is included in Nationalised Banks.

In 2010, Banking sector had seasoned well in terms of product development,supply and reach. Reach to remotely rural areas still pose challenges to the government

In terms of quality of assets and capital adequacy, Indian banks are considered to have clean, strong and transparent balance sheets relative to other banks in comparable economies in its region.

By 2013 the Indian Banking Industry employed 1,175,149 employees and had a total of 109,811 branches in India and 171 branches abroad and manages an aggregate deposit of₹67,504.54 and bank credit of ₹52,604.59. The net profit of the banks operating in India was ₹1,027.51 against a turnover of ₹9,148.59 for the financial year 2012-13 15 July 2015, 16.92 crore accounts were opened, with around ₹20,288.37 crore were deposited under the scheme which also has an option for opening new bank accounts with zero balance

Size of the Market: Currently the banking ecosystem in India consists of 26 public sector banks, 25 private sector banks, 43 foreign banks, 56 regional rural banks, 1,589 urban cooperative banks and 93,550 rural cooperative banks. Public Sector banks occupy 80 percent of the market, thereby showing dominance over the private lending banks. The mobile banking transactions in December 2015 incremented four times annually.

According to RBI(Reserve Bank of india), the banking sector is well capitalised and administered. The financial and economic conditions are balanced. Credit, Market and liquidity risk suggest that Indian banks are generally resilient and have stood strong against global plunge well.

Let’s highlight some key developments in the banking sector
• Canada Pension Plan Investment Board (CPPIB), an investment management company, has bought a large stake in Kotak Mahindra Bank Ltd from Japan-based Sumitomo Mitsui Banking Corporation.
• India’s first small finance bank called the Capital Small Finance Bank has started its operations by launching 10 branch offices in Punjab, and aims to increase the number of branches to 29 in the current FY 2016-17.
• FreeCharge, the wallet company owned by online retailer Snapdeal, has partnered with Yes Bank and MasterCard to launch FreeCharge Go, a virtual card that allows users to pay for goods and services at online shops and offline retailers.
• Exim Bank of India and the Government of Andhra Pradesh has signed a Memorandum of Understanding (MoU) to promote exports in the state.
• The Reserve Bank of India (RBI) has granted in-principle licences to 10 applicants to open small finance banks, which will help expanding access to financial services in rural and semi-urban areas.
• IDFC Bank has become the latest new bank to start operations with 23 branches, including 15 branches in rural areas of Madhya Pradesh.
• The RBI has given in-principle approval to 11 applicants to establish payment banks. These banks can accept deposits and remittances, but are not allowed to extend any loans.
• The RBI has allowed third-party white label automated teller machines (ATM) to accept international cards, including international prepaid cards, and said white label ATMs can now tie up with any commercial bank for cash supply.
• The RBI has allowed Indian alternative investment funds (AIFs), to invest abroad, in order to increase the investment opportunities for these funds.
• RBL Bank informed that it would be the anchor investor in Trifecta Capital’s Venture Debt Fund, the first alternative investment fund (AIF) in India with a commitment of Rs 50 crore (US$ 7.34 million). This move provides RBL Bank the opportunity to support the emerging venture debt market in India.
• Bandhan Financial Services raised Rs 1,600 crore (US$ 234.8 million) from two international institutional investors to help convert its microfinance business into a full service bank. Bandhan, one of the two entities to get a banking licence along with IDFC, launched its banking operations in August 2015.
Government Initiatives

The government and the regulator have undertaken several measures to strengthen the Indian banking sector.
• The Reserve Bank of India (RBI) has issued guidelines for priority sector lending certificates (PSLCs), according to which banks can issue four different kinds of PSLCs—those for the shortfall in agriculture lending, lending to small and marginal farmers, lending to micro enterprises and for overall lending targets – to meet their priority sector lending targets.
• The Reserve Bank of India (RBI) has allowed additional reserves to be part of tier-1 or core capital of banks, such as revaluation reserves linked to property holdings, foreign currency translation reserves and deferred tax assets, which is expected to shore up the capital of state-run banks and privately owned banks by up to Rs 35,000 crore (US$ 5.14 billion) and Rs 5,000 crore (US$ 734 million) respectively.
• Scheduled commercial banks can grant non-fund based facilities including partial credit enhancement (PEC), to those customers, who do not avail any fund based facility from any bank in India.
• Ministry of Finance has planned to inject Rs 5,000 crore (US$ 734 million) in eight public sector banks in order to boost their capital,
• To reduce the burden of loan repayment on farmers, a provision of Rs 15,000 crore (US$ 2.2 billion) has been made in the Union Budget 2016-17 towards interest subvention.
• Under Pradhan Mantri Jan Dhan Yojna (PMJDY), 217 million accounts! have been opened and 174.6 million RuPay debit cards have been issued. These new accounts have mustered deposits worth almost Rs 37,000crore (US$ 5.53 billion).
• The Government of India is looking to set up a special fund, as a part of National Investment and Infrastructure Fund (NIIF), to deal with stressed assets of banks. The special fund will potentially take over assets which are viable but don’t have additional fresh equity from promoters coming in to complete the project.
• The Reserve Bank of India (RBI) plans to soon come out with guidelines, such as common risk-based know-your-customer (KYC) norms, to reinforce protection for consumers, especially since a large number of Indians have now been financially included post the government’s massive drive to open a bank account for each household.
• To provide relief to the state electricity distribution companies, Government of India has proposed to their lenders that 75 per cent of their loans be converted to state government bonds in two phases by March 2017. This will help several banks, especially public sector banks, to offload credit to state electricity distribution companies from their loan book, thereby improving their asset quality.
• Government of India aims to extend insurance, pension and credit facilities to those excluded from these benefits under the PradhanMantri Jan DhanYojana (PMJDY).
• To facilitate an easy access to finance by Micro and Small Enterprises (MSEs), the Government/RBI has launched Credit Guarantee Fund Scheme to provide guarantee cover for collateral free credit facilities extended to MSEs upto Rs 1 Crore (US$ 0.15 million). Moreover, Micro Units Development & Refinance Agency (MUDRA) Ltd. was also established to refinance all Micro-finance Institutions (MFIs), which are in the business of lending to micro / small business entities engaged in manufacturing, trading and services activities upto Rs 10 lakh (US$ 0.015 million).
Future prospects:- The financial segment is undergoing several changes with many initiatives coming in. Country’s economic growth is likely to boom with positive business collaborations, consumer satisfaction and a balanced inflation.

Image Source:http://finanzasyproyectos.net/

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Salary Advance

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Some situations demand the need for that extra cash. The hammer of Emergencies can strike us anytime, and can cause a financial imbalance.
The very situations can put us in an embarrassing spot where in we have to resort to sources for borrowing personal loans.
One such source is our work place. Salary advance is the solution that we think of falling back onto. However getting an advance from our employer is not often an easy task.

There are various factors that impede our decision to ask for money from employer. We will list down some below
1. Work Environment: The work culture, and organisational policies are influential in determining the granting of salary advance. Some organisations post their salary day guidelines on their website. Some do not. In such cases seeking permission from the HR head or your boss may seem like an unachievable task. Explaining the need is an even more cumbersome task. You would have to figure out the perfect time to visit your boss, so that your request is not over looked.
These situations might push your bosses to look deep into your private finance management, which is not a great thing.
2. Paperwork: Layers of paperwork deter our will to ask for a salary advance. We dread taking a loan, because we do not want to surmounted by innumerable documents.
While some smaller organisations might agree for a loan with a handshake, others might ask you to deep dive into piles of documentation.
The documented agreement could talk about a repayment date. This could be your next salary date or a pre-decided period within which you need to repay the loan.
The paperwork could also include a clause that permits your employer to debit the repayment amount from your future paycheck. Some employers may even charge a few bucks to cover the paperwork.
3. Official agreements are binding: Borrowing from your employer is very different from borrowing from family or friends. You cannot have the attitude of “ I will pay whenever I can”. There is a fixed date, and failure to repay might be consequential in a bad way.
4. Your image perception by others: – Before you borrow, you are also enveloped by thoughts like “ What If I am unable to repay? What will my colleagues think of me” “Am I putting my reputation at stake by borrowing ?” “Will I strain my relationship with my boss?”All of these thoughts pester you even if you are borrowing for the first time. Also if this is a lifestyle issue, then resorting to your employer is a big no-no.
5. Acceptability : The higher you go up the corporate ladder, the probability of you getting a loan will be lower. Instead of going through the hassle of asking for a loan from your employer, use EarlySalary. EarlySalary is a one stop solution to all your cash worries. You do not have to think twice before asking us for money. Procedure for online application is very easy. The money transfer is an instant process, there is no paperwork and hesitation involved.
EarlySalary offers personal loans at a very low rate in the quickest possible way.
EarlySalary is a win-win solution for both the employees and the employers. The employers too would not have to bear any financial constraint. They would escape the paperwork involved.
EarlySalary renders a happy employee and employer situation.

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The World of Fintech

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The world of Fintech

The combination of Startups and Finance has lighted the thought bubble of Techies.
This has prodded them to move forward to build a space that blends both.
Basically Fintech organisations use technology to help users avail financial services effortlessly and on the go.
Fintech encompasses all technology-based companies operating in insurance, payment, loans, asset management etc.

Fintech is taking the technological space by a storm. With the introduction of these startups, the technical space the distance between technology and money has been bridged.

With the emerging industry of Fintech, there is an increased accessibility to the finance, along with an elevated awareness amongst the users of finance and technology. These firms offer instant, constant and efficient financial services to the users. They also serve as a competition to the conventional banks that exist.

The aim to integrate technology so that various systems in place interact has lead to the seamless processing of information and data transfer. This leads to better decision making processes(for cash, loans, credits etc) and also diminishes the cost.
With the emergence of multitudes of NBFC( Non-banking financial companies), Payment banks , mobile wallet companies etc have rendered a surge in the Fintech sector.

There are various verticals for Fintech
There are numerous startups that have ventured in the services of lending . These startups surpass the conventional financial institutions by offering alternative credit models, and also enhance the accessibility of users to money and money matters. Basically users can gain access to capital much faster and at a cheaper rates through these.

  • • Fintech has also entered Remittance. Remittance otherwise is a lengthy process with unending steps to achieve the goal. This holds true for both outward and inward transfer of funds. Also the costs associated are extravagant in nature
  • • They also provide both private and businesses to accept payments over the platforms of web and mobile. These Fintech startups intend on integrating payment processing into mobile and web apps without putting in extra efforts to maintain the merchant accounts. Steps are taken to ensure that there is no fraudulence that happens. The transfers have to be made directly into the bank account that is linked to the payee.
  • • Yet another bracket of Fintech companies exist that help individuals save manage and invest money. These Fintech companies essentially help in Personal Finance and retail Investment services. Also they help the individuals make better financial choices. Be it them wanting money or them wanting to save it.
  • • The infrastructural pertaining to old-age financial institutions are also be solved by these new Fintech organisations. There supremacy in technology and efficiency in finance is becoming popular amongst the people. They have enormously improved access to financial data and analytics is much easier and quicker now to get through to.
  • • Another intriguing Fintech Platform is providing access to crowdfunding . crowdfunding helps organisations in nascent stage to raise money and develop in the right direction.
  • • These companies initial focus lay on the core of finance, risk management and the incrementing revenues. However now it has expanded to user-friendliness and customer experience.

Fintech has not only disrupted traditional banking institutions, but has also made banking much easier for individuals. EarlySalary is one such organisation in the Fintech world. We at EarlySalary provide loans upto a lakh in minutes through your smartphone. And it is a very simple process! Just login through your Facebook account, fill in a few details and get instant cash. So wanna get some cash?
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All about investing in shares

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Shares share an important space in the different media of investment such as bonds, cash and property.
Let’s start by defining shares.
Shares are basically miniature snippets of a company. By owning a share, you own a tiny segment of the company, and also a proportion of the company’s value
Research shows that shares have proven to be amazing long-term investments in the financial arena. They usually surpass government bonds, corporate bonds etc.
There are risks associated, but in the longer term, you get rewarded with benefits.
You can choose to purchase shares, or you can invest in mutual funds. Funds essentially buy a set of shares that are monitored and administered by a fund manager.
And when you own a share, then you are a shareholder for that company. This can mean that you have certain rights over the decision making in the company.
So essentially if you have a share with a company, then over the years, the investment value of it increases with the company’s progress and profit making.
Also, there are certain shares that allow you to reap the benefits together with the company. Meaning the profit gets shared with you as dividends.

Owning a share in big and small establishments
In case of fully established and renowned organisations, you get profits as dividends, however the progress is a not a very fast process.
These dividends can be a regular source of income for you, and you can even invest it for further monetary gains. The income that you procure from dividends is taxed at a certain rate.
For smaller organisations, there are usually no dividends. However the growth is better there.
Also if you wish to sell the shares for that company, it doesn’t come easy. It is hard to find buyers, because of the lesser credibility of the company.
Analysing the growth of the company and predicting it accurately is also critical to us.
Big organisations like Infosys have a lot of happy employees owing to their shares in the company. Here the drivers, plumbers, attendants are all millionaires.
In today’s date, around 100 individuals in Infosys are billionaires, and around 2000 of them are millionaires. The management has a habit of rewarding it’s employees over the years for their dedication and hard work. With the progressing organisation the value of shares, and the benefits for shareholders (including the drivers, attendants etc) increased manifolds.

Risks associated with shares
The economic conditions of the company and it’s surroundings determine the boom or downfall of shares. If the share value decreases then the importance of your investment also fades away.
Holding shares in just one organisation is also very risky. You should spread the risk by owning shares in multiple organisations. Diversity is significant here. What if you own shares in only one company, and it drastically witnesses a degradation in it’s value, then you are at the risk of losing all your money.
Also diversifying helps in better returns with more stability.

Buying and selling of shares
If you intend on purchasing or selling of shares, then it is advisable to consult a traditional stockbroker. You can also consult an online broker or a financial adviser. A financial advisor can guide you well on what to buy and what to sell.
We hope you analyse well before investing in a share. Happy Investing!
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