JAGOINVESTOR

Rs 500/1000 notes banned – Here are 5 critical facts to know

Posted on November 9, 2016February 6, 2019 by Jagoinvestor

Last night, it was a historic moment when our Prime Minister informed the whole nation that Rs 500 and Rs 1000 notes will not be eligible currency notes from midnight at the end of 8th Nov, 2016. Here is the RBI notification

old currency notes ban

PM Modi had also explained all the points very well in his speech and shared how people should not worry about this if they have money with them and it can be exchanged with new notes in next 50 days, however seems like a lot of confusion is there around this topic and many myths are floating around.

5 important facts about the old notes bank

Below are some of the most important facts which you should know after this Rs 500 and Rs 1000 notes bank. There are lots of myths around and I wanted to clear them. These points which I have mentioned below are taken out of the RBI notification itself.

Fact #1 – You can deposit any amount of old notes in your bank/Post Office account

You can “deposit” your old currency in your bank account till 30st Dec, 2016. There is no limit on this amount and if you have Rs 50 lacs with you in Cash, you can just walk into your bank branch (expect a lot of rush) and just deposit the amount in your bank account. The limit which is there is on the “exchange” which is the next point. Please find below the exact wording from the RBI notification.

rbi notification note ban

Also note that there is no limit of deposit for account whose KYC is complete. If KYC is not yet complete, the limit is Rs 50,000.

#2 – You can exchange up to Rs 4,000 notes in ANY bank branch in first 15 days

You can walk to ANY bank branch and exchange up to Rs 4,000 of old notes along with your identity proof (PAN, Aadhaar card, Passport etc). You don’t need a bank account in the same bank. After 15 days, this limit of Rs 4,000 will be reviewed and raised. I am sure this small limit is kept so that most of the middle class and poor people are handled before other privileged class 🙂 . Apart from the bank branches, you can also visit RBI centers for this exchange.

#3 – You can deposit the money in 3rd party account also

It is also possible to deposit the money to 3rd party account also if you follow the full procedure and produce a valid ID proof (your own)

#4 – Cash withdrawal Limit from ATM and Bank Branch

There is following withdrawal limit set by the govt.

ATM – Withdrawal from ATMs would be restricted to Rs.2,000 per day per card up
to November 18, 2016. The limit will be raised to Rs.4,000 per day per card
from November 19, 2016 onwards.
Bank Branch – Till 24th Nov, 2016, you can walk to your bank branch and withdraw up to Rs 10,000 in a go, but the overall limit is Rs 20,000 per week.

#5 – You can deposit the old notes till 31st Mar, 2017 in worst case

In worst case, if you are not able to deposit the cash in your bank account or exchange those till 30st Dec, 2016, Still you will get another change to deposit the amount at RBI designated branched till 31st Mar, 2017 with proper documentation. One of my close friend parents are coming back to India from US after Jan, and they were worried after this news. I told them about this 31st Mar, 2017 deadline which calmed them!

Below is the speech by our Prime minister in case you want to hear it.

The big confusion and the Panic

This whole news which came out last night has created a big confusion among people and I can see many of them in panic situation. A lot of people who know clearly that their money is still safe and can be deposited back in bank account are also acting like the world has come to the end.

On the lighter note, social media went crazy and there were some really hilarious tweets which started circulating across various platforms.

tweet on note ban

There was news of people rushing to buying gold, doing shopping last night (till midnight) and what not. Understand that if your money is legally earned and you are paying the taxes, you need not panic and just keep calm, you can deposit it with bank and your money is 100% safe.

Only those who have black money will be facing problem as now all the money they have is worthless.

Discomfort because of the BAN

While there is surely some level of discomfort, but that’s very obvious and it’s bound to happen when things change at this level. This bank of old bank notes is for good and our countries future. This will really help curb black money and corruption in a big way.

notes ban image

Will update more on this topic in coming days. New notes of Rs 500, and Rs 2,000 will get started from Nov 11th .

Let us know your views around this topic in comments section below

Inactive EPF accounts to get interest from now onwards at 8.8%

Posted on November 7, 2016November 20, 2019 by Jagoinvestor

Good news, the inactive EPF accounts will now start getting interest. Also the interest will be paid since Mar month of this year. This will start once the govt issues the notification regarding this. Since 2011, the EPF accounts which were not active for 3 yrs before inoperative EPF accounts and they stopped getting the interest.

Now Inoperative EPF accounts will earn interest

However now the rules are changed and if someone wants to keep the money in EPF account, they can do so. The EPF account will keep earning the interest decided by EPFO from time to time. This year itself the news was out that the inoperative accounts will get interest. However the notification news has come just now yesterday.

As per the EPF officials, Around 42,000 crore has been lying in inoperative EPF accounts and they will get interest @8.8% now.

“The inoperative EPF accounts are not being paid interest since 2011. As per the instructions given by Prime Minister Narendra Modi and Finance Minister Arun Jaitley, we decided to start paying interest on those accounts to make them operative,” Mr. Dattatreya said on Monday.

You can now leave your EPF accounts active even after leaving the job

As per this latest development, now after you leave your job, and do not join somewhere else, you can leave the EPF account to keep earning the interest. Given that the EPF interest is upwards of 8%, it’s a good place to park the money.

Buy my first book in HINDI

Posted on October 31, 2016November 14, 2019 by Jagoinvestor

I had written my first book “16 Personal Finance Principles Every Investor Should Know“ a few years back and it got very popular among investors. It has close to 130 reviews on Flipkart + Amazon. Now the same book is translated in Hindi Language and is available for sale.

16-personal-finance-principles-every-investor-should-know-hindi-language

In Hindi it’s called – Ache Niveshak Ke 16 Sutra

The Hindi version is targeted towards those who can read Hindi books and not only for those who cannot read English, because it used enough English words (in Hindi script) at various points.

Buy the Hindi Book on Flipkart
Buy the Hindi Book on Amazon

There are enough number of people in our country who need financial literacy, but they are not able to read English and hence don’t read on internet as most of the content is in English

So if you know anyone who can benefit with my first book in Hindi format. Feel free to share about the book with them

6.5 million Debit Cards compromised in India – Was your card one of them?

Posted on October 21, 2016November 20, 2019 by Jagoinvestor

Around 6.5 million Indian Debit Cards have been compromised recently which is one of the biggest security breaches our country has seen to date.

Around 641 customers of 19 different banks have reported frauds worth Rs 1.3 crores in total as of now and after that, all banks started investigating the matter. Some of the banks that are worst affected are SBI bank, ICICI bank, HDFC bank, and Axis bank.

Here is a real incident reported by Vishal Sharma on this article below in the comments section

My card got cloned and my account was wiped out on 5th Sept 2016 by cash withdrawals from china . I immediately informed my bank Standard chartered who then blocked my card. It took 10 days and a lot of following up before they gave me a temporary credit.

SBI alone has reported that it has blocked around 6 lacs debit cards and going to issue new cards soon. This is done as a precautionary measure so that no frauds are done on these 6 lacs cards.

As per the following video, these compromised debit cards were used in the US and China while the debit card owners were in India.

How did this all start?

Around Sept start, various customers started complaining to banks about the fraudulent transactions, and that when banks started reaching out to National Payments Corporation of India (NPCI), which found out that it was a malware-related security breach in various ATM’s and Points of sale systems which were managed by Hitachi Payment Services.

That’s when the banks asked its customers to change their PIN. Banks also blocked cards and started providing the new cards to its users.

The banks are saying that this security breach has happened outside the bank’s network, but still, the investigation is going on right now and more details will come up in coming times.

How did the security breach happen & What got Hacked?

As per the above video from NDTV, almost every detail of the card was hacked like

Name on the card
Expiry Number
Card Number
CVV number

When you use your card at an ATM or a point of sale (in some shop), the data first goes to a central server (central server switch) and that further sends the data to your bank to check if you have balance in your account or not. This central server had the malware sitting and the data was compromised at that point.

Around 3.2 million debit cards hacked in India

Can you take some precautions?

The only thing you can do right now is either change your PIN. Most of the security measures are already taken by the banks, so you can’t do much from your side now other than getting your card blocked (not recommended). You can read more details about this news here

Do you know anyone who faced the card fraud? Can you share that?

What do you think about this issue? What are your views?

Here is what 11000+ investors told us about their top financial goal?

Posted on October 17, 2016November 20, 2019 by Jagoinvestor

A few months back, I read an article that talked about the biggest financial goals of Indians. As per their survey, the biggest financial goal for 34% of the respondents was “Securing Child Future”. The only issue was that their survey size was just 150.

“Retirement” was the biggest goal for only 2% of the respondents, which means just 3 out of 150 people marked “Retirement Planning” was their biggest goal.

The biggest financial goal in India

What is your biggest financial goal in life?

I was somehow not very convinced with their survey size of 150 because it’s not a big enough sample size to decide what most of the people feel. So I thought of conducting my own survey with a big enough sample size, and I was able to get 11,324 survey responses.

The first thing I asked was “Which is your biggest financial goal in life?”

Think about it?

What if I posed this question to you directly and asked – “Which is your biggest financial goal in life?”, what would you say?

I gave 6 options to people to choose from, and below were the results.

Top most financial goals of urban Indians

Goal #1 – Accumulating enough wealth in life to enjoy

“Accumulating enough wealth to enjoy life” was the topmost goal picked by the maximum people. This was very surprising for me because it was not a small sample size.

We had more than 11,000 people taking this survey and 3553 people out of that (around 31%) chose this option, which shows that somewhere priorities of people are changing these days. Now people want to accumulate wealth not just for retirement, but even to enjoy life before retirement.

They want to travel, experience new things in life, explore new hobbies and spend on themselves. In short, they want to enjoy life before retirement itself and not keep all the money only for retirement.

Goal #2 – Giving the best education to children

The next goal which was voted by maximum people was “Give the best education to their children”. Around 21% marked it as the biggest goal of their life, which confirms that still “children education” is an important and most sought after goal for investors.

It’s a given fact that giving the best education to your children is the best way to care for them and their future. Their life foundation is set by the quality of education you provide for them. It’s surely one of the most satisfying goals for a person.

Goal #3 – Planning for my retirement

I was happy to note that a big percentage (around 19%) said that planning for their retirement was their biggest financial goals. I want to reinforce the point that this survey was taken by people who are net savvy and mostly belong to big cities and earning decent money each month.

This result shows that a good number of people have realized that retirement is something they need to take seriously.

If I talk about you – Are you retirement ready? Do you feel you are doing enough for your retirement goal? If you are not sure, You can explore our pro membership program

We all have 30 yrs of working life to save money for 30 yrs of retirement on an average. So look at each year of working life-saving as a fuel which will help you each year of retirement. So what you invest in the year 2016 will help you in the year 2046 (2016 + 30 yrs). This concept comes from my book – “How to be your own financial planner in 10 steps”

Goal #4 – Buying a House

15% of people said that buying a house was their biggest financial goal. Given the unaffordable housing prices and the social stigma attached to “owning a house”, I am sure a lot of people feel the “pressure” of owning a house. Only the people who still don’t own home can feel the pressure and the worry associated with it.

No matter how many articles claiming “Renting is better than buying a house in India” comes, still its an emotional decision for people. They feel pressure from family, spouse, and society to buy a house and that’s the reality.

Goal #5 – Becoming Debt-free in life

A big number of investors are getting into a debt trap and a big portion of their income goes into serving the loan or paying off some family debt. It’s surely not a very great feeling to know that a part of your income will just go away somewhere and never return back or form any capital.

A lot of people want to get rid of debt as soon as possible and the high expenses these days make it very tough for someone to close their loan by paying off the debt soon.

Goal #6 – Saving enough money for kids marriage

I am sure we all have this goal in life.

We all want to save some money (or a little) for our kid’s marriage, but 2% of people marked it as their biggest goal in life. I am not sure if they have achieved rest other goals already or not. I do not have much comment on this point, because I don’t want to say if this is wrong or right. Maybe you can share what you feel about it?

So what is your biggest financial goal?

We saw all these 6 goals and how people responded to them. Would like to know what is your biggest financial goal in life and what do you think about this?

70% investors are “Asset Poor” – What about you?

Posted on October 4, 2016November 14, 2019 by Jagoinvestor

70% of people feel that they are “Asset Poor” as per my recent survey.

Are you one of them?

No matter how much you earn or how much wealth you have created until now, you will fall into one of the following 4 categories.

Asset Rich, Income Rich
Asset Rich, Income Poor
Asset Poor, Income Rich
Asset Poor, Income Poor

Suddenly one day, I thought how many people will consider them “Asset Rich” and “Income Rich”? So I thought of creating a survey which asked people just this simple question.

Survey with 1068 people

There is no good information available on this topic, hence I ran a survey for the last few weeks and I got 1,068 responses from various people who visit this blog.

Note that this survey does not represent the general population of the country, but those who work in big cities, have a decent income/wealth (probably) and are net-savvy. Basically our blog readers. So you can safely say that these 1,068 people are like you and me, hence these results are very relevant for you (our readers)

Before I discuss about each category and look more into it. I want to share with you the survey results highlights

Around 70% people see themselves as “Asset Poor”
Around 65% people see themselves as “Income Poor”
Only 10% of people felt they were “Asset Rich and Cash Rich” both

Asset Poor, Income Poor

At the bottom of the pyramid are the maximum people who feel them to be both “Asset Poor” and “Income poor” at the same time. As per our survey, it amounts to 45.97% people, or 45 people out of every 100.

Think about this, a big chunk of people feel they are not earning enough to lead a great life, nor they have built enough wealth to call themselves RICH. This is alarming!

Also note that these people “feel” themselves as Asset Poor, Income Poor. So it’s all about their own perception about themselves. So even a person earning Rs 50,000 per month might feel he/she is “Asset Poor, Income Poor”. It has a lot to do about your relationship with money.

I think people falling in this category must be highly stressed as they might be surrounded by various people who either own some properties or if not, at least earn decent enough to enjoy various materialistic things in life.

One of our old surveys shows that every 1 out of 2 people in India is stressed because of money related matters.

Asset Rich, Income Poor

This is an interesting category of people. A lot of people are asset rich, but Cash poor. You must be wondering how?

The best example of this category are some senior citizens who do not have any source of income, but they have good assets. However, they are either living in that property or it’s used by their kids now.

Another example for this category is families, which own ancestral homes in cities that were bought by their parents, and now those properties are worth crores, however, they still don’t have a decent income source. They might be into a small business or some kind of job, but they still earn enough to run the house.

Also in various smaller cities, there are many people who have a great amount of wealth, but their lifestyle if base minimum and they don’t spend enough on themselves. My own best friend who lives in Varanasi has wealth upwards of Rs 10 crore (total property worth), but they still run around all day each month trying to earn enough to meet the ends meet, because they can’t sell their lands just to enjoy life.

“What will people say”- is what holds them!

Asset Poor, Income Rich

Now comes the third category where 24.44% of people fall. These are mostly those people who have recently upgraded from the middle class to the higher middle class when it comes to income.

They are earning good salaries like 1/2/3 lacs per month (mostly in the IT industry), but they are still struggling to own a house of their own or to create any sizable wealth. Even if they own a house, it’s on a huge bank loan which ultimately makes them just rich on the left side of the balance sheet, but not in totality!

This category finds it very hard to build assets because their expenses are very high because of their lifestyle. As per this article which says “America is full of high-earning poor people”, most people earn a decent income, but they fail to save enough money to build wealth. I think many people in big Indian cities are going on the same path.

Asset Rich, Income Rich

This is simply the people who are at the higher end of the pyramid. With their several years of experience and discipline, they have created good wealth and also earn decent money each month. They are free from debt now (mostly)

A very high-level description for these people would be those who have

A house of their own without any loan
A good car without a loan
A stable and secure income stream of upwards of 1-2 lacs per month
Enough money lying in bank accounts or mutual funds/stocks

So what makes you Poor or Rich?

It’s all about how you structure your financial life and what shape you give it over the years. There is a big difference in the cash flow of Poor people and Rich people and the below diagram shows it in a very simple way.

Poor people – Earn and simple Spend that money on expenses, they keep doing this all their life and never build any assets

Middle Class – While middle class earns better income compared to poor people, still, they create enough liabilities which eat up all their income, if anything left after expenses

Rich People – Rich people do something different, they focus on creating assets that generate income for them over the years. It can be dividends from stocks, mutual funds or building real estate which gives income. I recently came across a very example of how rich mindset works and here is an example from Quora, where a guy “Varghese Thomas” is sharing his personal life example.

I know he is an NRI and some people might say that because he is an NRI, it’s easy for him to think like that, but still it’s all about the mindset and how far your thinking goes.

How to become “Asset Rich”?

While this is a topic which calls for a separate book, I will want to give an attempt to talk about it briefly.

To become Asset Rich, you need to first become Income Rich. There is no other option here, unless you have a rich relative who might leave his fortune to you 🙂

So you need to first move to the “Income Rich” category from “Income Poor” . When I say Income Rich, I mean you earn enough money each month, which helps you to save good amount of money after all your expenses and EMI’s. Because unless you keep investing good amount of money each month, becoming rich will be tough.

Even if you are generating very good returns like (12% or 15%), you will not build enough wealth if you do a SIP of Rs 3,000 per month. I hope you get my point.

The amount or quantum of money you put in each month is highly important.

So you need to upgrade your skills, work on increasing your income, save a good amount of it with discipline and take decisions which at least doesn’t lose you money, if not make wealth for you. I don’t want to go into details here, because this is a big topic.

What are Assets and Liability?

I really feel you should once watch this 2 min video from Robert Kiosaki where he explains about Assets and Liabilities. This will give you some really good background to start thinking how you want your financial life to shape up.

I hope you got some good insights into how people think about themselves and their financial situation. We would like to know what is your plan for moving to the upper category in the future? Please share more insights on this topic in the comments section.

How to withdraw your PPF account money anywhere in India? Here is the Process

Posted on September 26, 2016November 14, 2019 by Jagoinvestor

Today I am going to share very interesting and rare information related to PPF with you all.

Have you ever wondered how can one withdraw their PPF money without visiting the base branch (from where PPF was opened)? A lot of people open PPF account in one city and then move to another city. It’s really a headache to travel to another city just for the sake of closing the PPF account or withdrawing the money either at maturity or partially.

withdraw ppf from any branch

I tried to see if this is a problem that PPF holders face, and I found that a lot of people search for “Can I withdraw PPF from any SBI branch”? This means that this is widespread query and I decided to write on this.

There are many articles and people on internet who will tell you that you need to visit the base branch only to withdraw or close your PPF account, but recently I figured out that its not true and there is a process using which you can close or withdraw PPF money from any city without visiting the base branch where you opened the PPF account.

Here is one reference of a query like that on Yahoo answers

I want to share with you today that its a big myth and its actually POSSIBLE.

A few days back, I got in touch with Priyesh Sampat, Legacy & Succession Counsellor from Mumbai, who has handled hundreds of PPF related cases in the past. He shared with me how is it possible to withdraw money from the PPF account without visiting the original branch and he has seen it work in real life for his old clients.

He was very helpful and shared many insights and his experience on this topic. I thank him for that.

Steps to withdraw from your PPF account from a different city

Before I share the steps for PPF withdrawal from a different city, I want to mention that the steps below are applicable when you have your PPF account with SBI or some other public bank like PNB, Vijaya Bank, etc.

The steps below will not work in case you have PPF with Post office, in which case you first have to transfer your PPF from post office to SBI bank and then you can take the following steps.

Step #1 – Arrange your KYC documents

The first step is to make sure you arrange all your KYC documents like

Form C – For PPF withdrawal
Canceled Cheque – The account in which you want to money to be credited
Your Identity & Address Proof
Your PPF passbook (in case it is available with you)

Do not sign these documents at the moment, because these need to be signed in the presence of the bank officials. You can download PPF form C here

Step #2 – Go to a local branch of the bank

The next step is to visit the local bank branch of the city where you reside or are present and talk to the staff there. Tell them that you want to withdraw your PPF, but it’s base branch is in some other city, so you want them to attest the documents.

They will ask you to sign on the documents in your presence and might also put their signature or seal on the documents confirming that your attestation is complete. Also, request the attesting banker to mention his/her name and signature code issued by RBI. This makes the attestation complete in all regards.

Step #3 – Send documents to Main Branch using Speed/Registered post

Once the bank staff completes your verification and attestation, it might happen that they keep the documents and tell you that they will themselves send the documents to the main branch, in which case take an acknowledgement from them which has their signature and seal, so that you have the proof that you gave the documents to local branch.

Otherwise, you yourself will have to send the documents to the base branch where you opened your PPF account by speed post or registered post.

It’s important that you use a speed/registered post so that you have confirmation when the documents are delivered. Also as post office is a govt organization, you have all the records and you can also find out information using RTI later.

Step #4 – Get PPF money credited in your account by NEFT/RTGS

Once the original branch gets your documents, they will process them and credit back your PPF maturity amount by NEFT/RTGS.

In earlier days the banks used to hand over the Pay orders or DD which was supposed to be received by a person, but now with NEFT/RTGS facility the money is transferred electronically.

So the process for PPF withdrawal is very simple as explained above, but let us see some finer details or cases now

Can I use the same process mentioned above in case of partial withdrawal?

The answer is YES. The above process is not just for the PPF withdrawal at maturity, but even in case of partial PPF withdrawal after completion of 7 yrs.

I have PPF in Post office, how can I withdraw?

As I mentioned above, the above process will work only in case you have your PPF with a PSU bank, so the first step is to transfer your PPF account from Post office to the PSU bank. The steps are already mentioned in this article. Read the comments where many people have shared how they successfully transferred their PPF accounts to PSU banks.

I am an NRI, how can I withdraw my PPF account from outside India?

If you are an NRI, first thing you should know that that you cannot extend your PPF account after it matures in 15 yrs period. I am sure most of the NRI’s keep travelling to India every year or once in a while if not every year. So whenever you visit India next time, you can follow the same process which is given above.

However, if you still want to try withdrawing your PPF from abroad, let me share you the process which is not guaranteed to work always, but it’s already tried by Priyesh on one of her NRI clients and it worked for them.

The process for PPF withdrawal by NRI

Basically the PSU bank can only process your PPF withdrawal request if your signature is attested by an authority, which can be the PSU bank itself (which will need your presence) or some other authority.

If an NRI has an NRE/NRO account in a bank (a good bank balance or relationship with a bank will be a plus), then they can follow this process

Courier the documents to India in the city where you have the NRE/NRO account. Make sure you send these documents to a person (relative, parents, siblings etc or friends)
Give an authority letter mentioning that you are allowing the person to follow this process on your behalf
Ask the person to go to the bank where you have NRE/NRO account and ask them to attest these documents (mainly the signature part) . At this step you can expect the friction, because this is not a standard process.
Once the attestation is done, then you can ask your person to visit the PSU bank for PPF withdrawal and they might accept these documents which are attested by your bank.

Note that Priyesh has done the same steps for one of her NRI client and it worked because the NRI was giving a very good premium each year to the bank and bank was more than happy to “help” the client 🙂

Why can’t you withdraw PPF from any branch?

Truly speaking I have no answer for that.

I know that with the advancement of technology, the PPF withdrawal process should be smoother now and it should be possible with a button of click, but as of now, it’s not the reality.

A lot of people still wait to travel to their base branch city where they opened their PPF and follow the process. However many investors never withdraw their PPF because they are not clear if it’s possible or not.

It was my attempt to bring this process in notice of yours so that you can at least try this and see if it works. If someone has done something different and successfully withdrawn their PPF from a different city, please share that with us in comment section and we will add it in the main article.

We would like to know if you got any new insights or not and this article was helpful or not?

From 1st Oct, Insurance policies will be issued online (even renewal policies)

Posted on September 17, 2016November 14, 2019 by Jagoinvestor

Starting 1st Oct 2016, all the insurance policies are going to be issued in electronic form.

Yes, you heard it right

Few years back IRDA had come up with the concept of 13 digit e-Insurance Account (EIA), where an investor had the option to convert their existing physical policies into demat form, but till now it was not mandatory. However now things have changed and starting 1st Oct,2016 it has become compulsory.

Now, every insurance company has to issue all kinds of insurance policies in an online format. So if you are buying any kind of insurance policies (life, health, motor, pension policies and all kind of general insurance policies too) you need to have an e-Insurance Account (EIA) and the policies will be issued in Demat form only in that account.

This will be true even for renewal policies. So even if you are not buying any fresh new policy, at the time of your policy renewal this will apply to you

Under which cases, is this e-insurance account mandatory?

This e-account is required only if the annual premium crosses Rs 10,000 for most of the policies like term plan and health insurance or if the sum assured is above 5-10 lacs. The exact requirement is as follows for various kind of policies (source link)

e-insurance-rules-policies

How to open E-Insurance Account?

Step 1: Choose the Insurance Repository

There are 5 registered insurance repositories in the country, licensed by IRDA, out of which you need to choose one. These are …

CAMS Repository Services
SHCIL Projects Limited
Central Insurance Repository
Karvy Insurance Repository
NSDL Database Management

Note that you can choose any one of them, and there won’t be any difference, other than level of service. At the backend, everything will be the same. Also if you are not satisfied with your insurance repository provider service, you can switch to another one later.

Step 2: Fill up the form and submit the documents

The process now is very simple, once you have decided the repository company, all you need to do is fill-up the form and attach your KYC documents and submit it to their office in your city.

CAMSrepository also has an option where you can first fill-up the form online and then download the filled form. I think it will work for most people and save time. If you want to fill the form offline, you can download e-insurance account opening form here

Following are the documents you need to submit

e-Insurance Account form (fill by hand OR filled online one)
Date of Birth Proof (PAN , Passport, Voter Id etc)
Photocopy of ID proof (PAN or Aadhaar Card)
Photocopy of Address proof (Aadhaar, Passport, Electricity or Telephone Bill etc)
Canceled cheque
Passport size photograph

Note that the canceled cheque is required so that the information of the bank account is captured beforehand, Any maturity proceeds or claim amount will be paid in this same account. Ideally, this should be the same one from where the insurance premium is paid, but not mandatory.

All the major insurance companies like LIC, ICICI, HDFC, and others have already joined hands with this facility.

Check out this short video created by CAMS team

Once you submit the documents, it will just take a few days to open the account.

If you need the detailed list of the documents required, you can view this PDF document (2nd page)

The concept of Authorized Representative

A special feature called “Authorized Representative” is introduced in this e-insurance account where an investor can assign someone trustworthy or close to being AI (authorized representative) who will be able to access the details of the account in case of death of the policyholder. This is different than the nominee.

For example, I can give my close friend name and details in the AI section ask him to have a look at all my details in case I am dead and ask him to communicate things to my family as per my plan.

Features and Benefits of e-Insurance Account (EIA)

Let me know to share some benefits and key points of this e-insurance account and how it will benefit the overall insurance industry as well as the investor, even though it may look like another hassle to you right now

FREE account – This account will be 100% FREE account for investors, there are no charges or maintenance fees to be paid by anyone. One person will have only a single account (like PAN)
All policies at one place – This will be the single point of contact for investors to view, download and manage their insurance policies, be it life, health, motor or any travel insurance policy.
No KYC repetition while buying new policies – After doing the KYC first time, you won’t have to do it again and again when you buy new policies. All you would need to do is mention your EIA number and buy the policy.
Get reminders – You will get reminders for your policy maturity, payment reminders and any other important updates.
Single place to update your KYC – IF you want to update your mobile, address or other details, you will just have to update it in e-insurance account and not in each policy individually.

Understand that with this initiative, the insurance companies will simplify their process and a good amount will be saved as there won’t be a lot of paperwork involved (printing of documents, courier etc) and that’s why insurance companies will fund this initiative and will keep it FREE for investors.

Converting your existing physical Policy in Electronic form

I know you must be thinking about what will happen to my existing policies which I have bought till date? So, there is a simple process to convert them online.

Once you open the e-insurance account, you can apply for conversion of your existing policies into the online form (its good that you do it beforehand, because at the time of renewal it’s going to happen anyways going forward)

As per Cam’s repository FAQ point 18, you can just mention your policy number and it will be converted into an online format

18. How do I convert my existing paper policy into electronic form?

If you already have eInsurance account, log in to your eInsurance account, click on “ePolicy conversion” and enter your policy number, name of Insurance company that needs to be converted into ePolicy. In the next few days, your policy will be converted into ePolicy.

You can also download the policy conversion form and submit it for offline -> online conversion of policies

Please share what do you think about this new rule? Do you think it will help investors and the insurance industry?

CIBIL introduces Subscription Services!. Get 4 quarterly reports at Rs 1,200

Posted on September 12, 2016November 14, 2019 by Jagoinvestor

CIBIL has now started subscription services for its customers. Now you can get bimonthly or quarterly CIBIL Reports if you want to track your credit score on an ongoing basis, then this service is for you.

cibil subscription services

How to apply for the CIBIL report on a subscription basis?

Earlier you only had an option to buy your CIBIL Credit Report on a one-time basis by paying fees. Now you can buy it on a subscription basis if you wish to.

You need to visit https://www.cibil.com/creditscore/. There you will see 3 options which have 1 report (one time), 2 reports (half-yearly) or 4 reports (quarterly). One can choose any one of these options and fill up other authentication-related details and then make the payment online. You will start getting your reports on email.
cibil subscription charges

Who should opt for the CIBIL subscription?

I think all those investors who are going to apply for loans in near future and want to keep a watch on their scores or those investors whose CIBIL Reports were bad earlier and they have taken steps to improve their scores, can apply for CIBIL subscription so that they get the periodic reports. However also note that from the coming year, CIBIL will provide one FREE report anyways

At this point of time, the one-time CIBIL Report + score costs Rs 550, if you apply for another report within the period of 12 months, then your total cost anyways will be Rs 1,100 , where as the quarterly subscription cost Rs 1,200. However if you are the first time applicant, I suggest only buy the one time report.

How to correct CIBIL report mistakes in next 30 days – A step by step Guide

Posted on August 16, 2016November 14, 2019 by Jagoinvestor

Today I am going to teach you some step by step process which will help you to correct your wrong CIBIL entries, which will, in turn, improve your CIBIL score. Most of the investors take some of the other kinds of loan and if they are not able to pay the EMI’s on time or default on the loan, their CIBIL report gets messed up and they don’t get further loans in future.

This is because once your credit history becomes bad, then lenders are not very excited to give you loans.

correct credit report mistakes

How to correct the CIBIL record?

I recently got a question from Mukesh Kumar, who saw a wrong entry in his CIBIL report. See what he says…

I have an error in my cibil report that I applied for loan in 2009.but it is wrong entry. How can it be corrected.

CIBIL report can contain mistakes either due to the investor’s mistake and their ignorance, but many a time the errors happen because of bank mistakes or manual issues.

Some reasons for mistakes in the Credit report

The lender did not update the correct remarks with CIBIL
The lender updated the wrong remark with CIBIL
CIBIL makes mistake in name, address, gender or date of birth while creating the report
The mistake happened while generating the CIBIL report
There was some fraud using your documents and hence the wrong entries

4 Step process of correcting the CIBIL mistakes

Let me help you with the step by step process if you want to fix the errors in your credit report. Here you go ..

Step #1 : Check your CIBIL report

You will not be able to move ahead unless you properly understand your current situation. So the first step is to apply for your CIBIL report and understand it properly.

You can go to CIBIL website and pay the fees to get your report. Once you pay the CIBIL charges, you will receive the PDF report in your mail almost instantly which will contain your credit score and the report. Below is a nice video tutorial by the CIBIL team which shows you how to read the CIBIL report.

Step #2 – Raise a Dispute Resolution with CIBIL

Once you have understood your report, you should make the list of all the errors and mistakes in the report.

After that, your first point of contact is CIBIL. You should raise something called a CIBIL Dispute Resolution at https://www.cibil.com/dispute/.

You need to fill up some details and mention the issues in your report which you think should be corrected. Once you do this, your dispute will get recorded and CIBIL will get in touch with the lenders one by one and ask them to relook at the issues if they would like to send a new update (the correct one).

Note that CIBIL will never make any changes in your report themselves. They will only do it once they get a go-ahead from the lender because at the end of the day, your CIBIL report is the collection of all the information CIBIL gets from various lenders.

How online dispute resolution with CIBIL works?

dispute resolution cibil process

It can take anywhere from few days to 30 days for your dispute resolution to get sorted out. But I suggest waiting for 45 days. If you have questions on this, I suggest you read the FAQ on dispute resolution here

This dispute resolution can be raised even if you have not bought the report yourself but got it from the lender while applying for some loan.

Now, in this case, it might happen that the lender refuses to correct some information because they think that they are correct and the investor is wrong. In which case the investor should take the 3rd step.

Step #3 – Contact lenders directly

If the dispute resolution works, then the changes will happen in the report. But at times some lenders might disagree to some point and refuse to make the changes.

At this point, CIBIL can’t do much and you will now have to follow-up with the lender yourself.

Let me give you an example.

Suppose there is a guy who checks his credit report and see that one of the loans which he paid off fully, is marked as “WRITTEN OFF”. In this case, he can raise a dispute resolution with CIBIL and let’s say the lender says that the loan was still not paid off and some amount was remaining and with interest and late payment charges, the loan becomes bigger and later they marked it as WRITTEN OFF.

In this case, the guy has to contact the lender himself and then sort things out.

He can ask for all the explanation proofs and loan statements and prove if there was any loan outstanding or not. In this case, it would have helped if the person had taken a NOC once he thought that the loan is complete and paid off.

Contact lender through email + phone

Coming back to this point, the first step is to send an email to the lender, stating your case with proper dates and the error in the report. If possible, also attach a snapshot of the CIBIL report. Then wait for a few days for their response, and if you don’t get any response, then you should visit their branch in the city.

Meet the manager there or whoever is the in-charge of the CIBIL loans section. If 30 days are over and you are not getting any proper response, it’s the time to raise an online complaint with banking ombudsman. This way you have at least raised one leg of investigation and waged a war against the lender.

To give you an example, see how lender did not update the correct status with CIBIL in this case below

I have taken loan from fullerton India long back and paid the same. they have also given me NOC. But the same is still not updated in CIBIL records. My financials status is now good and I can pay loan installments regularly. I am good salaried and paying IT also regularly. Can this improve my CIBIL Score and Can I get Loan ?

In case you face any issues, feel free to contact CIBIL team. Here are the CIBIL contact numbers on this link. Call their customer care number and mention your issues, at times this can bring faster results.

Step #4 – Close your Past Dues and Outstanding amounts, if any

Finally, once you contact the lender, it might happen that there was a genuine mistake from the lender’s end. If they agree, they will update the correct status with CIBIL and your issue will get resolved in 60-90 days. But if not, then mostly the issue is due to some past outstanding amount which did not pay.

Loan Settlements and not paying EMI on time.

In most of the cases I have seen, the issue is some past loan for which 100% outstanding was not paid off by investor and it was settled for a lower amount. For example, support you owe Rs 1 lacs in the loan, but are unable to pay it and you do the settlement for Rs 60,000.
Years later then you see a remark on your CIBIL Report which says “SETTLED” or “WRITTEN OFF”. At this point the situation is very bad because most of the investors don’t want to pay this surprising amount just to fix things.

Check out this real-life case

I took Durable loan with Capital-First in Feb 2014 with period of 9 months. I paid first 6 EMI’s on time but the last EMI I didn’t paid, one fine day I got call from Capital-First Legal team and they asked me to clear rest of amount. So I paid remaining amount in single shot using Capital first online portal in Aug 2015.

Recently in Feb 2016 I pull CIBIL Report and I found the above account marked as “WRITTEN-OFF” and Raised Dispute with CIBIL, I observed in latest (in May 2016) CIBIL report that the status changed “WRITTEN-OFF” to “POST(W/O) Settled”. I discussed with Capital First Customer care many times. They just gave reply like “you paid amount in stage of WRITTEN-OFF status. so it should be POST(W/O) Settled. it won’t change further”

Is that true? and How do I remove that status from My CIBIL?

In this case, it’s very difficult to improve your score, because that bad remark will be there for many years/decades, unless you clear off the loan.

Get in touch with lender

So if possible try to get in touch with the lender and speak to them about this. Ask them how you can get a “closed” remark for a loan. At times lenders are ready to take a lesser amount and update the entry as “Closed” with CIBIL.

Once you follow all these steps and correct your CIBIL mistakes, your CIBIL score will go up over time.

I hope you got a fair step by step process on correcting the mistakes in the CIBIL report? In case there are any questions, I will be happy to take them in the comments section.