What are the features of the FAStag?

A new payment program introduced by the government, FASTag is a type of Electronic Toll Collection (TOLL) that has been rolled out on the highways of the country. FASTag has been fashioned by the Indian Ministry of Road Transport and Highways and is now being implemented by the Indian National Highways authority. In order to make FASTag a success, the Indian Highways management Company Limited (IHMCL) has teamed up with Axis Banks as well as ICICI Bank to help Indian citizens clear toll payments and transactions.

How does FASTag function?

This system of toll clearance has been adopted in foreign countries and basically involves the installation of a Radio Frequency Identification (RFID) device or strip which is fixed to vehicle windscreens. The technology makes toll payment easy as the driver does not have to stop to pay the toll at the toll booth. The money is automatically deducted from his prepaid account. FASTag is valid for about 5 years, and one can recharge it whenever they want after buying it.

Here are a few commendable features of this new technology that one should be aware of-

• The first and most important feature is cashless payment. Those who use FASTag do not need to worry about carrying change in order to pay money at the toll booth. They can wiz by in no time.

• In order to promote the use of FASTag, the government offered a cashback offer. Anyone who used this technology got a 10% cashback every month till the 31st of March 2017.

• One is definitely assured faster transit. This is primarily because an individual using this feature will not have to wait for the staff at the toll booth to complete the transaction and fish for change. The money will be directly deducted from their prepaid account which is must faster.

• One can recharge their FASTag prepaid account online via net banking, credit card, IMPS as well as a debit card.

• One will get SMS alerts on the mobile number they have registered in case of a transaction or if their balance is low.

• One can do a minimum recharge of hundred rupees and a maximum recharge of one lahk rupees.

• In case a person owns 2 vehicles, each vehicle will require FASTag facility.

• In case of loss of vehicle or if it is stolen, one can immediately block their account by calling customer care.

One can create a FASTag Account for themselves either by visiting the 2 banks that the government has associated with or one of the Point of Sale (PoS) stations near toll plazas in the country.

Making the most of your forex card on your travels

Travelling overseas has become hassle-free with the advent of the forex card. It allows you to make payments in the regional currency without any trouble. A person does not need to go to the currency exchange center to get local currency when he/she travels to another country. This is because the forex card or the travel card is pre-loaded with the foreign currency. Therefore, it allows a person to withdraw cash in foreign currency, shop, make payments and also to check the balance. A single currency or even multiple currencies can be loaded into the card and this allows a person to travel seamlessly across a number of countries.

Furthermore, these cards are widely accepted as they registered either with the Visa network or the MasterCard network.

The different benefits of using a forex card are as follows:

• You need not worry about fluctuating exchange rates. This is because the money that you have put into the card will become immune and not get affected by the changing market rates. A person who has loaded in money in a forex card will surely receive the value of the currency that he had initially signed up for.

• A forex card comes with security features like chip and pin technology and this enables a person to block the card if it is stolen or lost. The balance amount is frozen and no other person can gain access to that fund. Therefore, it is always better to carry a forex card instead of cash when a person is travelling abroad.

• A travel card usually offers better exchange rates when compared to using cash to buy foreign currency. When a person uses a forex card, he/she generally gets a difference of 50paise as exchange rate markup. On the other hand, a person who buys US dollars with cash has to bear a difference of Rs 2.

• Some banks in our country allow multiple currencies to be loaded into a single card. A person is liable to carry different currencies like Japanese Yen, Australian Dollar, Hong Kong Dollars, US dollars and Euro and others. Thus, foreign travel has been made extremely convenient and easy.

• A person will have to bear lesser transaction charges when he/she uses a travel card. The charges are much less when compared to that incurred by using Debit or Credit cards.

• A person does not have to pay Dynamic Currency Conversion fee while using this card.

These benefits ensure that a person can bid goodbye to his/her currency woes while travelling abroad.

Easy steps to open a FD Account now

A fixed deposit is an essential financial tool that can be used to increase assets over time. However, prior to generating returns on the investment, one has to open such an account with a bank. Such an account can be opened both online and offline. Here is the procedure that needs to follow in case one is trying to invest in a fixed deposit.

How to open online FD account?

With the emergence of the internet, people can easily visit the online webpage of their banks and elect to open an FD account from there. In the fixed deposit related section of the webpage, the banks offer an online form to the customers. You need to fill up the entire form and submit it. Once submitted, you will receive an email from the bank, where the completed form is attached.

Take a print out of the completed form. A representative from the bank in question will contact you shortly and fix an appointment for the collection of the application along with the other documents needed for opening such an account. Alternatively, you can also elect to visit the nearest branch of the bank and submit the documents there yourself.
Before submission, ensure that you have signed the printed out application form. Paste your photograph in the appropriate slot as indicated in the form.

Finally, keep a photo identification handy for the completion of the procedure. Aadhaar card and PAN card may be the most preferable ID in such a case.
Submit the documents along with a CTS compliant cheque so that the funds are cleared faster. This ends the online procedure for creating an FD account.

How to open offline FD account?

If you do not have access to the internet or want to complete the procedure manually, you can visit a branch of the bank itself. Once you are in the bank enquire on how to open an FD account. The staff will provide you with the application form. You have to fill it up and submit the required documents to the bank to open the account.

The CTS compliant cheque, which carries the FD amount can also be handed over to the bank alongside the completed form and documents. Once the cheque clears, the FD account will be created. In some cases, the offline method is faster when compared to the online procedure. However, before opening the account, one should ensure that they are aware of the interest rates offered by the bank. Conduct research to select the best fixed deposit investment.

What are the types of deposits available in India today?

Banks in India, offer quite a few services to their customers, ranging from money savings options to loans as well as investments. One can open a savings account in a bank to save up some cash, or opt for any type of loan be it a home loan or even a car loan. Investments through banks may be done via banks deposits, bonds or mutual funds etc.

When it comes to the various types of deposits that are available in India today, the first 2 types that one may be aware of are fixed deposits and recurring deposits. Fixed and recurring deposits are the most common types of deposits.

Bank deposit has been divided into 3 specific types. They are-

1. Time deposit
2. Demand deposit
3. CASA deposits
These 2 deposits have been further categorized into other forms of bank deposit.

Time Deposit

In case of time deposits, the money is deposited with the bank for a certain period of time. An individual cannot withdraw the amount before the tenure is over. If a depositor does withdraw cash from the bank deposit account before maturity a penalty fee is charged. Time deposits are thus also known as term deposits. The time deposit that is most commonly opted for is fixed deposit. Other time deposits include re-investment deposits and recurring deposits.

Those opting for time deposits can save as well as enjoy returns in the form of interest. The interest rate offered on time deposits varies from one bank to another. Longer the term of the deposit, higher will be the rate of interest that the bank will offer.

Demand Deposit
 In case of demand deposits, the money deposited with the bank can be withdrawn anytime. The bank does not need to be given a notice in advance. The funds can be withdrawn via a cheque, ATM or from the bank directly.

Those who opt for a demand deposit may or may not receive interest from the bank. Even if interest is given, the rate is generally quite low.
There are 2 types of demand deposits, namely savings account and current account.

CASA Deposits
A savings account and current account deposit together is known as a CASA deposit. These deposits pay low interest and are quite beneficial for banks. Banks want to increases the number of CASA deposits they have, thus they offer services to companies like salary accounts etc.

Other types of deposits in the country also include NRO, NE (E) RA as well as FCNA (A) accounts. One can also avail insurance for deposits in India.

Features of the NRE account and how it can benefit you

Non-residential Indians (NRIs) can maintain a rupee account in India. NRIs have two options available to open and operate a bank account in India – NRE or Non-resident Rupee account and NRO or Non-Resident Ordinary Rupee account.

A NRE account allows a person to transfer or convert Indian currency and also allows him/her to park their money in various savings accounts. The primary reason why a person would want to open this account is if he/she wants to convert his/her overseas earnings into Indian rupees. This account allows a person to maintain a savings account in Indian currency, he/she can hold a joint account with another NRI or if the person wants his savings in rupees to be fully repatriable.  

The features of a NRE account are:

• The amount that is saved in this type of an account can be repatriated overseas as well.

• A NRI can open this account and he/she can hold it jointly with another NRI or PIO.
The deposits in this account can be done in the following ways:
• A NRI can deposit money in this account personally when he/she visits India and the deposit can be made in Indian currency and a few other foreign currencies.
• Deposits can also be made in a NRE account through the foreign exchange transfer while in a foreign country.
• A person can also deposit in such an account by transferring funds through NRE account or FCNR account that are held in financial institutions apart from banks.
You can open NRE account online to enjoy the features of NRE account such as:
• A person does not have to pay taxes on the interest that he/she earns from the deposits in this type of account.
• The Reserve Bank of India has set some guidelines about how to document the transaction procedures and how to submit those to the governing body. NRIs have to fill in the Form A4 when he/she is depositing money in foreign currency through remittance or via demand drafts or cheques. A person who does transactions above Rs 1, 00,000 needs to submit proper documentation.
• The credit and debit flows into and out of this account are regulated by FEMA by imposition of a set of permissible transfer types.
• A person having Power of Attorney can only perform limited tasks like withdrawing money and remitting money across the border so that it can reach the account holder.
The advantages of NRE account are as follows:
• This account allows a non-residential Indian to invest in different deposit schemes and saving schemes of banks in India.
• You can also open NRE account online to avail a loan from foreign as well as Indian banks. Moreover, the amount of loan that a person can get is much higher in comparison to loans provided to other types of accounts.
• You can transfer funds from one country to another without incurring any cost.
• You can also transfer funds from this account to other FCNR/NRE accounts of the same person or even of a different person.

A person can avail facilities like cheque book, international credit card and also pay bills if he/she has a NRE account.

How to manage your education loan EMI’s?

Education loans are essential for students who wish to pursue higher studies or go abroad to complete their education. Most banks now provide these loans to students, but also charge a substantial interest when it comes to paying back the sum. While taking a loan itself may be easy, paying off the debt may prove to be difficult for some students.

The bank usually allows the student some time after he/she has completed their education before asking for the EMI repayment. This period of time is known as repayment holiday. Usually the bank allows a period of one year from the time of completion of education to the time of the first EMI payment. However, this period may be shorter if the student manages to get a job within six months of the degree completion.

Here is a look at some of the guidelines to follow if you want to manage the repayment of your education loan in India.

Ways to reduce burden
For education loans above Rs.4 Lacs, the student has to pay a certain percentage of the expense, while the rest is lent out by the bank. For studying in India, the student has to pay 5% of the loan while for education overseas the student has to furnish 15% of the expense. However, if you are a good student, some banks may relax these rates.

It is also better to take the loan amount through small payments over time instead of taking the entire amount at once. This reduces the interest that you will have to pay once the repayment period starts.

Start saving prior to repayment
If you have taken out an education loan, it is highly advisable that you start saving money during your education. You can opt for a part-time employment in order to start saving early. The repayment holiday can also be utilized to save up enough money so that there is no issue while repayment of the debt.

Keep an eye on the rate of interest
Education loan in India is given out on a floating rate of interest. This means that the rate of interest may change over time. So, it is highly recommended that you keep a backup savings for emergencies if the rate of interest suddenly escalates. However, to do this, you need to earn enough to save some money after paying EMI and meeting monthly expenses.

These are some of the easiest ways of ensuring that education loan EMI does not get too difficult to manage. Keeping expenses in check during the loan repayment tenure is the best way to handle the burden of the loan.

Gold Loan: Why it is a popular option in India?

India is a country that loves gold. Indians are the largest importers of gold in the whole wide world. This precious metal is not only useful as an ornament to be worn at festivals but a good gift option as well. These days banks and non-banking financial institutions are offering loan against gold.

Gold loan is granted by a lender against the gold that is kept as mortgage and hence, this loan is a secured loan. The gold needs to be deposited with lenders before the loan is availed. The lenders will conduct a few checks and may offer loans for as high as 80% of the metal’s value. Most households in India have at least some gold at their home or in a bank. They can utilize this loan to meet emergency requirement of funds such as expanding a business, a medical emergency, child education or even for down payment to purchase a vehicle.

The various benefits of applying for a gold loan are:

• As the gold loan is a secured loan, banks are generally non-hesitant in granting it. Banks or other financial institutions always have the option of selling off the gold in case of any default on the payment.

• Banks or financial institutions may even allow a person to only pay the interest for the loan. The person can pay back the principal amount at the end of the tenure.

• Gold loan interest rates are generally lower in comparison to the interest rate that is charged by a bank or a financial institution on any unsecured loan. Thus, this provides some relief to the borrower.

• As the gold is kept as collateral, a person is eligible for a loan against gold even if his/her credit history is not so commendable. A person’s repayment capacity is also not considered. Thus, it is often easier for a person to avail a gold loan to meet his/her urgent requirement of money.

• Lenders also generally do not ask for an income proof to be submitted by the borrower. This is because the physical gold is kept with them.

• A person availing such a loan does not generally lose ownership of the gold that he/she is mortgaging. He/she will get it back after repaying the loan.

• Many banks and non-banking financial companies charge less or no penalty for prepayment of the loan. Sometimes, they do not even charge processing fees. Thus a borrower is not overburdened with the task of paying more money.

In India, the government has also made it easier for women and agriculturists to get gold loan by announcing special goal loan schemes. Gold assets usually increase in value and hence, it is easier for lenders to trust a person who wants a loan against gold. These are the reasons why gold loan is a popular option in India.