1. Demonetization IMPACT ON BANKS’ ASSET QUALITY WILL SHOW IN Q4: The asset quality problems for banks and finance institutions are rising as small customers are finding it very difficult with the adverse effect of demonetization on their business. But since RBI has given an additional 60 days’ time for borrowers to repay their dues, the banks have time to classify these assets as non-performing. Added to this, because of the demonetization work pressure, banks are unable to concentrate on recovery which will show its impact in the fourth quarter.

2. ONLINE LENDING FIRMS SEE HIGHER GROWTH: As Indian economy is taking a formalshift to cashless economy, lending companies who are engaged in online lending are seeing a huge potential to grow. Some online companies are rolling out plans for lending to restaurants and small traders against their sale through point-of- sale machines. Some of the online companies like Capital Float and LendingKart may double their business figures.

3. LINK FINANCIAL DATA OF CORPORATES TO DETERMINE CREDITWORTHINESS, SAYS CII: Confederation of Indian Industry (CII) has said that linking financial data and consolidating the existing data of small and medium enterprises and corporates can provide banks with the necessary information to assess creditworthiness of borrowers. It said it is possible to thread the said data accesses together for a well-connected digital infrastructure so as to enable banks to lend to credible borrowers and that too at a tailored interest rate.

4. PAY WITH YOUR AADHAAR CARD SOON: No card, No smartphone, No point-of- sale machine but if you have Aadhaar card and if the same is linked to your bank account then very soon you also can make payment. The use of Aadhaar-enabled payment system and opening up of Aadhaar database is on the verge of making it a reality. IDFC Bank and SBI have already introduced biometric readers at merchant outlets. There are 109 crore people enrolled with Aadhaar and hence this mode could be the most preferred mode of payment in future.

5. LOAN REPAYMENT WINDOW EXTENDED TO 90 DAYS BY RBI: In an effort to bring further relief to the people hit by demonetisation, the Reserve Bank of India gave borrowers another 30 days over and above 60 days for repayment of housing, car, farm and other loans up to Rs.1 crore.

6. CABINET MAY PASS AN ORDINANCE ON OLD NOTES: The government is all set to pass an ordinance to settle all issues regarding demonetization, extinguishing of the Reserve Bank of India’s liability in respect of the Cancelled Currency. The ordinance is likely to provide for a limited window to return cancelled currency in special cases only at RBI counters till March 31 st 2017. But this will be enabled with stiff conditions and only for people who can give valid reasons for not being able to deposit the cancelled currency before 30 th December 2016. An Ordinance for imposing heavy penalty has already been announced for possession of more than 10 notes of banned currency after 31/03/2017.

7. RBI WARNS BANKS ABOUT THE BENEFIT TO NBFCs FROM THE STRESS IN BANKING SECTOR : RBI is proposing to go ahead with a new bunch of Banks, such as Custodian and Wholesale Banks. Also it asked existing banks to rework their strategies, as Non Banking Finance Companies(NBFCs) are benefiting from the stress in banking sector.