Products For Banks & Their Customers
Tasthana means as flexible as the stalk of a lotus. It is a totally flexible deposit where you can increase or decrease the principal, interest and tenure whenever you want. It can have a single, joint or a consortium of depositors. Tasthana computes TDS automatically and factors Form 15 H/G apart from calculating Penalties and GST.
Tasthana has Reverse Annuity with single and multiple beneficiaries, each getting the same or different amount. The Reverse Annuity can be Amount Based with or without Top-up or Tenure Based. It combines all Sweep Deposits if the interest rate is the same. In short it is a one stop super market for deposits as it handles all the current features of the existing deposits and much more.
Tasthana must help the bank increase its deposit base by a least 10% and if we take a sample deposit base of ₹ 3,000 million, then the increase is ₹ 300 million. For ₹ 300 Million, if the liability is 6% and if 60% of Deposit is lent at 13%, then the gain to the bank is over ₹ 5 Million.
Tasthana was curated by banks and please see the matrix below:
|1||Regulations||Different Interest Rates for the Same Tenure||All deposits have the same interest rate for the same tenure|
|2||Sweep Deposits||Sweep Deposits - Whenever a new sweep deposit was created it was a new deposit. This meant many deposits gets created and it becomes very hard to reconcile with so many deposits and with withdrawals it becomes still harder.||Combining all Sweep Deposits into one deposit if their interest rates are same. This results in very few deposits as most of them get clubbed together|
|3||Asset Liability Mismatch||A Deposit is a Liability to the bank. The bank has to lend against this deposit. Thus it has to have a match against this liability while lending. If the entire deposit amount is withdrawn then it affects the assets as it has no liabilities.||In order to mitigate such a mismatch a part of the deposits say 40% is kept as Fixed which the customer cannot touch. He/She can withdraw from the balance 60% or the Variable Component as partial withdrawals. If the Fixed Component is touched the deposit closes.|
|4||Consortium of Depositors||Required more than 2 depositors to have a deposit account||More than 2 depositors can open a Deposit Account. Each person would have a have a percentage in it. For example say 4 people have a deposit then they could share it as: 35%, 25%, 16% and 24% making it 100%. This would mean that any modifications would also be done accordingly as per the percentage . Please note that even the joint depositors have the deposit as percentage. It can be 50 - 50, 60 - 40, 72 - 28, etc.|
|5||TDS||TDS is an issue with various deposits having various tenure and varying rate of interest||It computes TDS automatically irrespective of tenure and rate of interest with any modification made any time|
|6||Form 15 H/G||Form 15 H/G is for Tax Exemption and it has to be integrated with the system||It can be downloaded, filled up and sent. Once the Bank receives it they can stop the TDS from that moment onwards. Whatever TDS that has been paid prior to receipt of the Form 15 H/G has to be claimed back from the Tax Department by the Customer|
|7||Location||Where would the Application Rest?||The application would rest in the bank and the customer would first log in the bank using User ID and Password and then access it|
|8||Business Scenarios||Static Interest Rate, Rising Interest Rate and Decreasing Interest Rate||The customer does not lose out when static and benefits in the rest two scenarios and the bank does not lose out.|
|9||Large Deposit||Can it accept large deposits and what would be the extra outgo for the bank?||We have taken the total deposit to ₹ 34 Lakh Crores. No bank has such a large deposit in South East Asia. The total outgo comes to maximum 0.07% of the total deposits|
|10||Reverse Annuity||Can it configure a Bank Deposit for Reverse Annuity?||It calculates it both Amount Based and Tenure Based. For amount based, if a deposit of say ₹ 1,00,000 is created and assume a sum of ₹ 5,000 is to paid each month it pays the sum each month till it becomes 0. It can be topped up and continued or closed.
For tenure based, if we consider the same deposit of ₹ 1,00,000 with an outgo of ₹ 5,000 each month then the tenure could be fixed for say 6 months, 15 months, etc. at the discretion of the issuer and the funds would be disbursed for up to the mentioned month and then it stops.
|11||Reverse Annuity||Can it pay to multiple beneficiaries different sums and varying tenure?||It can pay multiple beneficiaries multiple different sums either amount based or tenure based. It can also pay additional sums as desired by the deposit holder|
|12||Integration||How would the Integration with Core Banking happen?||It will integrate seamlessly with core banking software and it will not affect the working of any module in Core Banking. It will have the same touch points as the regular deposits. The only difference here is that there will 2 reports - one for regular deposits and the other for flexible deposits. Also the entire deposits can be migrated to the new deposit.|
The reason why flexi deposit is better are:
Benefits of Tasthana compared to the current Deposits: