India Micro and Small Enterprises, issuing guideline

India has a diversified financial sector undergoing rapid
expansion, both in terms of strong growth of existing financial services firms
and new entities entering the market. The sector comprises commercial banks,
insurance companies, non-banking financial companies, co-operatives, pension
funds, mutual funds and other smaller financial entities.

The banking regulator has allowed new entities such as payments
banks to be created recently thereby adding to the types of entities operating
in the sector. However, the financial sector in India is predominantly
a banking sector with commercial banks accounting for more than 64
per cent of the total assets held by the financial system.

 

The Government of India has introduced several reforms to
liberalise, regulate and enhance this industry. The Government and Reserve Bank
of India (RBI) have taken various measures to facilitate easy access to finance
for Micro, Small and Medium Enterprises (MSMEs). These measures include
launching Credit Guarantee Fund Scheme for Micro and Small Enterprises, issuing
guideline to banks regarding collateral requirements and setting up a Micro
Units Development and Refinance Agency (MUDRA). With a combined push by both
government and private sector, India is undoubtedly one of the world’s most
vibrant capital markets.

 

The
asset management industry in India is among the fastest growing in the world. At
the end of April 2017, the assets under management of the mutual fund industry
stood at US$ 299.04 billion. Inflows in India’s mutual fund schemes via the
systematic investment plan (SIP) route rose 44 per cent year-on-year to reach a
record high of Rs 4,584 crore (US$ 711.17 million) in May 2017.

 

 

 

Government
Initiatives

 

·        
US$ 1.48 billion allocated for
recapitalization of Public Sector Banks under Union Budget 2017-18

·        
 The FDI composite cap in the insurance segment
increased to 49 per cent from 26 per cent

·        
Simplification of procedures
and uniform registration and prescribing other norms for entry for foreign
portfolio investors

·        
 Reduction in securities transaction tax from
0.125 per cent to 0.1 per cent on cash delivery transactions and from 0.017 per
cent to 0.1 per cent on equity futures

 

Types of Financial Institutions

Banking – Under this an individual can deposit his or her
money and can get return in the form of interest and also borrowers can
get loan by paying interest to bank periodically.
Insurance – By using this one can get peace of mind as one
can buy insurance policies like life insurance, fire, marine, health and
general insurance which ensures that person in the event of any mishap can
get his or her money back from insurance company.
Stock Market – One can invest his or her funds into stock
market also where one gets dividends and also capital appreciation, if one
makes right investment decision than return from equity markets are much
greater than that of fixed deposits parked in banks.
Treasury or Debt instruments – Under this one can invest his or her money into
government bonds and also debt instruments of private and public firms.
 Wealth Management –
There are many firms where one can jus park their money and then these
companies invest money across different assets classes like commodity,
derivatives, money market, currency etc… in order to generated superior
returns for their clients.
Mutual Funds – These funds track asset class and generate
returns accordingly so a debt fund will track returns of debt and money
market, an equity mutual fund would give returns according to performance
of stock market and so on.
Tax consultants and audit firms – These organizations help people in determining
their tax liability, advising their clients on how to save tax and also
filing of their tax returns on time.

 

 

 

 India has a diversified financial sector undergoing rapid
expansion, both in terms of strong growth of existing financial services firms
and new entities entering the market. The sector comprises commercial banks,
insurance companies, non-banking financial companies, co-operatives, pension
funds, mutual funds and other smaller financial entities.

The banking regulator has allowed new entities such as payments
banks to be created recently thereby adding to the types of entities operating
in the sector. However, the financial sector in India is predominantly
a banking sector with commercial banks accounting for more than 64
per cent of the total assets held by the financial system.

 

The Government of India has introduced several reforms to
liberalise, regulate and enhance this industry. The Government and Reserve Bank
of India (RBI) have taken various measures to facilitate easy access to finance
for Micro, Small and Medium Enterprises (MSMEs). These measures include
launching Credit Guarantee Fund Scheme for Micro and Small Enterprises, issuing
guideline to banks regarding collateral requirements and setting up a Micro
Units Development and Refinance Agency (MUDRA). With a combined push by both
government and private sector, India is undoubtedly one of the world’s most
vibrant capital markets.

 

The
asset management industry in India is among the fastest growing in the world. At
the end of April 2017, the assets under management of the mutual fund industry
stood at US$ 299.04 billion. Inflows in India’s mutual fund schemes via the
systematic investment plan (SIP) route rose 44 per cent year-on-year to reach a
record high of Rs 4,584 crore (US$ 711.17 million) in May 2017.

 

 

 

Government
Initiatives

 

·        
US$ 1.48 billion allocated for
recapitalization of Public Sector Banks under Union Budget 2017-18

·        
 The FDI composite cap in the insurance segment
increased to 49 per cent from 26 per cent

·        
Simplification of procedures
and uniform registration and prescribing other norms for entry for foreign
portfolio investors

·        
 Reduction in securities transaction tax from
0.125 per cent to 0.1 per cent on cash delivery transactions and from 0.017 per
cent to 0.1 per cent on equity futures

 

Types of Financial Institutions

Banking – Under this an individual can deposit his or her
money and can get return in the form of interest and also borrowers can
get loan by paying interest to bank periodically.
Insurance – By using this one can get peace of mind as one
can buy insurance policies like life insurance, fire, marine, health and
general insurance which ensures that person in the event of any mishap can
get his or her money back from insurance company.
Stock Market – One can invest his or her funds into stock
market also where one gets dividends and also capital appreciation, if one
makes right investment decision than return from equity markets are much
greater than that of fixed deposits parked in banks.
Treasury or Debt instruments – Under this one can invest his or her money into
government bonds and also debt instruments of private and public firms.
 Wealth Management –
There are many firms where one can jus park their money and then these
companies invest money across different assets classes like commodity,
derivatives, money market, currency etc… in order to generated superior
returns for their clients.
Mutual Funds – These funds track asset class and generate
returns accordingly so a debt fund will track returns of debt and money
market, an equity mutual fund would give returns according to performance
of stock market and so on.
Tax consultants and audit firms – These organizations help people in determining
their tax liability, advising their clients on how to save tax and also
filing of their tax returns on time.