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In the recent years, there has been a surge in the number of e-commerce startups. This has resulted in a higher usage of payment gateways. These gateways are beneficial in developing customer trust through easier transactional capabilities.

A large number of studies show that the demand for reliable payment gateways will continue to rise. Businesses may choose from several gateway service providers to ensure safe, quick, and easy monetary transactions.

Digitalization of different processes, new payment platforms, and demand for finance provide challenges and opportunities to payment ventures operating in India. Here are four reasons for the growth of payment gateways in the country.

1. Increase in service providers that are taking advantage of opportunities with advanced technical apps
2. Extension of financial inclusion using mobile-based solutions
3. Newer innovations that are reaching the masses at quickly
4. Digitalization for the development of new lending and payment models

Traditional banks are adopting innovative payment-linked ecosystems for the convenience of their customers. Banks are especially providing specialized solutions for catering to the needs of the Small and Medium Enterprises (SMEs).Several mobile platforms allow payments across different categories, such as bill payments, shopping, and peer-to-peer payments.

Most of the large companies have adopted digitalization since many years. These companies conduct their various processes, such as accounts management, treasury management, and payments electronically. Such large enterprises consider advanced technologies while selecting their banking partners.

Importance of digitalization in the SME sector

In the last few years, most banks have developed cash management systems that are convenient for their customers. Almost every bank offers mobile-based cash management tools that are used by companies for not only managing their accounts but also initiating payments.

As larger companies embrace digitalization, the SME ventures still rely on cash and branch banking. The banks are offering several initiatives to encourage SMEs to move to digital platforms. One of these includes enabling merchants to receive card-based receipts using low-end mobile devices. This offers a non-cash alternative for several SME businesses. Another initiative benefiting many customer-orientated companies is the Immediate Payment Service (IMPS) that makes transacting quick, transparent, and efficient.

Banks are offering several cash management services to help SMEs improve operational efficiencies. Here are four categories of such services offered by banks.

1. Management

• Optimal collection and payment systems on behalf of customers
• Wide network access, clearing infrastructure, special software, and correspondent banks’ tie-ups for timely and efficient operations

2. Products

• Receivables management
• Information technology (IT) solutions for customized multiple electronic payment mechanisms
• Collection of cheques in bulk
• Cheque purchasing facilities
• Management of post-dated cheques

3. Payable management

• Refund of Initial Public Offerings (IPOs), interest and dividend warrants
• Bulk demand draft with entire correspondent banking network
• Remote printing of different instruments including cheques

4. Escrow services

• Availability of escrow depository accounts
• Dedicated team of legal and financial product personnel for assisting complex transactions
• Transaction structuring with lawyers, clients, or investment bankers
• Customization of reports and Management Information System (MIS) as per customer requirements

Streamlined processing mechanisms and real-time data integration make it easier for SMEs and large companies to gain access to various solutions as per their needs.

A savings bank account is where most people begin their journey of savings. There is no safer place than a bank to store your money. It also pays you for keeping your money there in the form of interest. But, there are several banks around and each have their own benefits, so before you open a savings account decide a bank to go to. Following are steps on how to open a savings account –

– Select a bank

Inquire about banks that are situated in your locality. Better will be to research about them online as there is an abundance of information available online. Each bank will have a distinctive service and offer, decide which one’s best for you. Important points to consider is the presence of the bank and their ATM networks. Also remember that you will be needing several services of your bank at random hours so there has to be an availability of online and mobile banking as well. Be it physically or digitally, your bank should be within reach all the time.

– Check out their website

If you like a bank then go ahead and check out their website and find out more about their services. You can check out each and every service of theirs by just sitting on your desk. The advent of mobile and online banking has made life convenient, also ATMs can be accessed 24/7 making banking simpler and hassle free. Plan your visit to the bank on weekdays at 9.30 a.m. to 3.30 p.m. and on Saturdays at 9.30 a.m. to 1.30 p.m. Banks remain closed on Sundays and other public holidays.

– Type of account

Although we know that we’ve to open a savings account, there are several types of savings account out there catered specifically to match your needs. Some options are Easy access accounts, Basic savings accounts, Joint savings accounts, Women’s savings accounts and Youth account. Best option for you will be to get in touch with bank representative and ask for details.

– Keep information ready

To open any savings account you will have to submit certain documents and information to the bank. This is a norm that is followed by all banks, some banks will require more information and several documents will be asked, it will be better if you keep these documents handy.

– Depositing your opening amount

Several banks require a minimum amount deposit to open a new account. The amount depends on the bank, some may have a greater minimum amount deposit and same may have none. Find out these details in advance and have the amount ready when you’re about to open a new account.

– Read and understand the terms

Do not hesitate to ask questions, you should be clear about each and every aspect of the account. Also read the information available online on the bank’s website, inquire about service charges, benefits and services available on the account.

– Sample signature

You will asked for a sample signature while opening your account. This signature will be used in all of your future transactions related to the account, like withdrawing money or signing a check. If there are noticeable differences in your signature then the transaction won’t be permitted. This a procedure done to keep your account safe and to avoid any issues with the signature, you can practice it on a piece of paper for several times.

– Account opened!

Congratulations, you’re now a valued bank customer. After the verification of your form and documents, your account will be opened. You will receive a welcome kit from the bank that will include important information about your account like information leaflets, cheque book and customer relation number. The kit may also include your debit card, with the pin number, also attached will be your net banking and phone banking pin.

With the advent of technology on the banking front, you can also opt for online account opening, the procedure is easy and the steps are hassle-free.

Most families have accumulated a significant amount of debt due to auto loans or credit cards that have been used over the years. Acquiring debt can make it easy to feel limited with your finances, which can make it difficult to make ends meet. To become debt-free and obtain financial freedom, there are a few important steps to take.

1. Create a Budget

Creating a budget will allow you to determine how much money you can afford to put towards your debt each month. Calculate your household income and write down your expenses, which will allow you to get an idea of how much debt you will pay off with each paycheck.

2. Establish Goals

Establishing goals to pay off your debt in a specific time frame will make it easier to stay on track and avoid losing focus with paying off the debt in full.

3. Cut Coupons

You can save more money each month to put towards your debt by cutting coupons in the newspaper for food and household items that you already purchase. Combine manufacturer coupons and store coupons to double your savings.

4. Pay Off Lowest Balances First

Paying off the accounts that have the lowest balance first, which will allow you to stay motivated and will reduce the amount of money that you pay in interest each month. There are some credit repair companies that can help you consolidate and repay your loans.

5. Avoid Eating Out

Reduce the money that you spend each month by making your meals at home and avoid dining out when you’re on the go. Prepare meals and have easy snacks on hand to take to work and stay within your food budget.

6. Shop at Secondhand Stores

Shopping for clothing or goods at secondhand stores can allow you to avoid paying full price for products that your family may need when it comes to purchasing school clothes or work attire.

7. Use the Envelope System

Convert your paycheck into cash and transfer it into different envelopes to avoid overspending and track how much you have left to spend. This will allow you to become more conscious of how much money you spend without relying on a credit or debit card.

Although it can be challenging to pay off debt as a family, there are several lifestyle changes that can be made to make progress with the money that you owe. By establishing rules with your finances and making goals, you can track the money that you pay off to ensure that you obtain freedom in a realistic time frame.

The National Pension System (NPS), introduced by the Indian government in the year 2004 is mandatory for all government employees except the armed forces personnel.This scheme was extended to the private sector in 2009. It is a portable retirement savings account, which can be efficiently used to provide financial security to senior’s through a pension income.

This scheme offers benefits such as tax deduction of INR 1.5 lacs under section 80CCD (1) of the Income Tax Act (IT). An additional tax deduction of up to INR 50,000 under section 80CCD (1B) of the IT Act is also available. Subscribers also have the flexibility of choosing asset allocation between equity, fixed income instruments, and government securities.

NPS is known as a defined contribution scheme because returns under this scheme are market driven. The NPS interest rate changes based on the performance of the market and the asset allocation chosen by the subscribers.

Asset allocation under NPS

Funds invested in NPS can be invested into 3 types of assets namely equity, corporate bonds, and government securities. There are two investment options available under this plan;auto choice and active choice.

Under auto choice, funds are automatically allocated in a pre-determined proportion based on the age of the subscriber. For example for subscribers under the age of 35 years, funds are allocated as follows: 50% in equity and balance amongst corporate bonds and government securities. As the subscribers age, the exposure to equity is reduced and investment in government securities increase.

Under the active choice option, subscribers may choose the asset allocation as per their preferences. The NPS scheme allows subscribers to allot upto 50% of their contributions to equity. Subscribers may use this option to their advantage to maximize the potential returns. For instance, an Investor approaching retirement age (between 45 to 50 years) may opt for a conservative allocation by investing a substantial portion of his funds in government securities.

Maturity and Annuities

The primary objective of NPS is to create a corpus that is used to buy an annuity plan for regular income during the post-retirement years. At the age of 60, the subscriber may with draw a maximum of 60% of the funds as a lump sum. The remaining corpus is used to purchase an annuity that will provide regular income to the subscriber.

Subscribers may choose not to withdraw any funds and use 100% of the corpus to buy an annuity. However, if the corpus at the time of exit from NPS at the age of 60 years is less than 2 lacs, the subscribers may withdraw the entire amount in lump sum. To determine the potential income, individuals may use an online pension plan calculator.

Joining NPS

In order to join the NPS scheme, the subscribers must submit the NPS application form, along with Know Your Customer documents to a Point of Presence (POP). Upon submitting the documents, the subscribers are issued with a Permanent Retirement Account Number (PRAN), T-Pin and I-Pin. Subscribers are informed of their PRAN application status via email and SMS. They may also know their application status by contacting the issuing bank. However, the subscribers may get in touch with the Central Record Keeping Agency (CRA) which manages the issuance of PRAN, in case the PRAN card is not received.

NPS is focused on offering financial security to the individuals after their retirement. The flexibility available for investors to allocate their contributions in different asset classes allows them to maximize the returns and accumulate a higher post-retirement income.

Private lending companies will provide the facility of merging several loans into one and charge a lower monthly interest rate than the prevailing one. But it should always be carefully noted that federal loans provide better interest rate than the private ones and hence these two should be kept separate. Detailed information has been provided below regarding the advantages of consolidation and refinancing of student loan to have a better view of the two.

Advantages of Federal Student Loan Consolidation

Getting hold of an experienced and knowledgeable company equipped with a streamlined online application process provides its borrowers with an opportunity to save well before the subsequent loan amount is up for due. The hassles of searching for a reputed company has been solved by online service providers like financial hot seat who after comparing among several possible alternatives provides a list of the top six companies who have a good reputation in the market regarding student loan consolidation and refinancing. Unlike the traditional ways of borrowing money, the student loan consolidation facility provided via internet substantially reduces the loan amount to be repaid at the end of the term by keeping a check on the rate of borrowing. This is a big help for students who are the budding face of an economy and has been newly introduced in the job market.

Advantages of refinancing

There are several benefits of consolidating or refinancing a student loan, be it private or federal, which each and every borrower must know in order to derive the maximum possible benefit from its use. The advantages are briefed as under:

Convenience – Students who opt for loan refinancing needs to make only a single payment every month instead of multiple payments since refinancing combines all the existing loans of the borrower into a single loan amount.

Market fluctuations – The rate of interest prevailing in the market is quite volatile and is prone to frequent changes every year. Borrowers who have been paying higher interest on their existing loan have the opportunity to take advantage of any fall in the rate of borrowing which was not available at the time of initial borrowing.

Greater cash flow – Refinancing a number of loans into a single one will require lesser payment per month than each one being paid separately. This will indirectly lead to more cash to spend at the end of the month thereby ensuring improved cash flow.

Better credit history – Making a timely payment for a single loan is easier than individual payments being made. This creates a higher chance to improve the credit worthiness of the borrower increasing his chances to obtain more loans from the market easily.

Improved savings – The last but not the least is the advantage of saving a substantial amount of money when it comes to loan consolidation and refinancing.

A more detailed information about the beneficial effects of refinancing can be gathered from the internet and reliable sites like the financial hot seat to explore and experience its benefits in case the situation demands for exercising such facility.