By The Buyt Desk
New year comes with new rules. There have been many changes in the way we are spending and making our purchases. Here are 5 things that will have an impact on your finances and you must know about them.
Clearance of high-value cheque
The cheque clearance system will change from the new year 2021. RBI has mandated banks to implement ‘positive pay system’ for cheque clearance. A cheque payment of the amount greater than Rs 50,000 will go through the positive pay mechanism. Apart from signing the cheque, the cheque issuer will have to send the beneficiary’s details separately to the bank. Details like the beneficiary’s name, the amount, cheque number and date of the cheque issue will have to be sent electronically to bank through SMS, mobile app, internet banking or ATM. The cheque will be cleared only after cross-checking the information, and they must match. If there is any discrepancy between the sent data and the cheque details, then payment will not be honoured. The RBI notification says that availing positive pay mechanism will be at the consumer’s discretion, but banks may consider making this mandatory for cheques valued more than Rs 5 lakh.
Contactless card transaction limit increased
The limit of contactless card transaction is raised from Rs 2000 to Rs 5000. In the ‘new normal’ era enhancement of contactless transaction is a welcome move. The consumers can make payment of up to Rs 5000 from their credit/debit cards without even punching the PIN. The chip fitted in the card identifies the radio frequency from the terminal. When the card is tapped on the card reader, the device uses NFC (near-field communication) to read the card and process the transaction.
E-mandates for Recurring transaction
The e-mandate processing limit of credit and debit cards for recurring transactions will be Rs 5000 from 1st January 2021. The consumers can give an e-mandate for credit and debit cards and do away with the two-factor authentication process for payments of up to Rs 5,000.
A simple and basic Insurance
To make insurance simple and easy to understand the Insurance Regulatory and Development Authority of India (IRDAI) has mandated the life insurance companies to bring easy to understand standard life term plans. This standard policy will be named – ‘Saral Jeevan Bima‘. The term plan will be written in simple to understand language, with similar features and standardised terms and condition. All the 24 life insurance companies have to put a common name in the prefix, i.e. Saral Jeevan Bima followed by the companies name.
Structure of multi-cap mutual fund scheme changes
Earlier the fund managers were free to decide how much of the scheme’s asset will go to large-cap, mid-cap and small-cap. It was mandatory for multi-cap funds to have a minimum of 65% of their assets invested in equities at any given time. Sebi issued new norms for multi-cap mutual fund schemes in September 2020. Now multi-cap mutual fund schemes are mandated to invest at least 25% each in large-cap, mid-cap, and small-cap stocks. SEBI also increased the minimum allocation to equities from 65% to 75%. Sebi has given fund houses time till January 2021 to comply with the new norms.
