Skip to main content

100% FDI likely in cash, ATM firms

By

Cash and ATM management companies will soon be allowed to attract 100 per cent foreign direct investment as they are not required to comply with the Private Security Agencies (Regulation) Act (PSARA).Aclarification to this effect is likely to be issued by the home ministry shortly.
The clarification will be against the backdrop of the confusion among firms in cash and ATM management relating to compliance with the Act, under which they can receive FDI only up to 49 per cent.
The issue was discussed atameeting convened by the Prime Minister´s Office (PMO) last month.
“In that meeting, it was decided that the home ministry would be asked to issueaclarification that these companies will not have to comply with PSARA and would be eligible to attract 100 per cent FDI,” an official said.
There are aboutadozen cash management players in the country, including Writer Safeguard, SIS Securitas, CMS, Secure Value, Logicash, Brinks Arya, Securitrans and Scientific Security Management Services.
According to experts, companies managing cash for banks have so far been caught inapolicy tangle, with the home ministry insisting that 100 per cent FDI could not be allowed for them if they provide private security guards or armoured vehicles.
Companies that make devices such as currency authenticators and sorting and currency counting machines will also benefit from this clarification, they added. Several players, including TVS Electronics and ITI, are in such businesses. Cash management companies handle over Rs 40,000 crore of cash per day.
The government in 2015 permitted 100 per cent FDI under the automatic route for white label ATM operations with an aim to promote financial inclusion.
FDI into the country grew 22 per cent to $ 35.85 billion during April December of 2016-17.
The Business Standard New Delhi, 17th April 2017 

Comments

Post a Comment

Popular posts from this blog

Household debt up, but India still lags emerging-market economies: RBI

By
  Although household debt in India is rising, driven by increased borrowing from the financial sector, it remains lower than in other emerging-market economies (EMEs), the Reserve Bank of India (RBI) said in its Financial Stability Report. It added that non-housing retail loans, largely taken for consumption, accounted for 55 per cent of total household debt.As of December 2024, India’s household debt-to-gross domestic product ratio stood at 41.9 per cent. “...Non-housing retail loans, which are mostly used for consumption purposes, formed 54.9 per cent of total household debt as of March 2025 and 25.7 per cent of disposable income as of March 2024. Moreover, the share of these loans has been growing consistently over the years, and their growth has outpaced that of both housing loans and agriculture and business loans,” the RBI said in its report.Housing loans, by contrast, made up 29 per cent of household debt, and their growth has remained steady. However, disaggregated data sho...
Post a Comment
Read more

External spillovers likely to hit India's financial system: RBI report

By
  While India’s growth remains insulated from global headwinds mainly due to buoyant domestic demand, the domestic financial system could, however, be impacted by external spillovers, the Reserve Bank of India (RBI) said in its half yearly Financial Stability Report published on Monday.Furthermore, the rising global trade disputes and intensifying geopolitical hostilities could negatively impact the domestic growth outlook and reduce the demand for bank credit, which has decelerated sharply. “Moreover, it could also lead to increased risk aversion among investors and further corrections in domestic equity markets, which despite the recent correction, remain at the high end of their historical range,” the report said.It noted that there is some build-up of stress, primarily in financial markets, on account of global spillovers, which is reflected in the marginal rise in the financial system stress indicator, an indicator of the stress level in the financial system, compared to its p...
Post a Comment
Read more

Healthy balance sheets augur well for economy: RBI Governor Sanjay Malhotra

By
  Large tariffs by the United States administration and elevated geopolitical risk have increased near-term global financial stability risks, and along with weather events pose downside risks to domestic growth, Reserve Bank of India(RBI) Governor Sanjay Malhotra said in the foreword to the Financial Stability Report released today.Noting that domestic growth momentum is buoyed by strong domestic drivers, sound macroeconomic fundamentals and prudent policies, Malhotra said: “External spillovers and weather-related events could pose downside risks to growth.”On the other hand, he said the outlook for inflation is benign, and there is greater confidence in the durable alignment of inflation with the Reserve Bank’s target.Commenting that the structural shifts reshaping the global economy are making policy intervention challenging, the Governor emphasised the need for central banks and financial sector regulators to remain vigilant, prudent and agile in safeguarding their economies and...
Post a Comment
Read more