The payment system of India and the relevant legislation - Free Essay Example

Sample details Pages: 7 Words: 2007 Downloads: 9 Date added: 2017/06/26 Category Law Essay Topics: India Essay Did you like this example? Introduction The development of a country depends upon the financial stability of that country. The government or central authority of country formulates the schemes which can work efficiently and adequately for the proper functioning of the financial sector of a country. The financial sector of India has undergone drastic change in the last two decades. Don’t waste time! Our writers will create an original "The payment system of India and the relevant legislation" essay for you Create order Payment plays a vital role in the financial sector and it is considered as indispensable part in everyday transactions. A payment system is a mechanism that facilitates transfer of value between a payer and a beneficiary by which the payer discharges the payment obligations to the beneficiary.[1] The payment and settlement system serve as a backbone of financial system of a country.[2] Payment increases the GDP of the country therefore the payment system of country should be safe, secure, efficient and accessible. A safe and efficient payment and settlement system is sine qua non for the proper functioning of the financial system and it also plays an important role in the implementation of monetary policy as they provide conduit through which policy signals are transmitted.[3] Generally the central bank of any country works for the development of national payment system. The Reserve Bank of India (RBI), like other central banks, has been endeavoring to develop the payment and sett lement system in India on a safe, sound, secure and efficient basis.[4] The Indian payment system is based on the paper- transaction but with the changing time the situation has changed. An alternative method of payment has been encouraged by reserve Bank of India which will make the process of banking system easier and bring safety, security and efficiency in the payment system. With the efforts of the Reserve Bank of India, the Indian banking sector has been progressing and trying to adopt and implement electronic payment to enhance the banking system.[5] The Reserve Bank of India has introduced Real Time Gross Settlement (RTGS) and National Electronic Funds Transfer (NEFT) and National Electronic Clearing Services which facilitates customer to adopt electronic method of payment. It is confirmed by the survey that use of electronic method of payment has increased over a period of time. The reason behind this is advancement in the technology, increasing awareness among the consu mers and internet accessibility. The Reserve Bank of India has played pivotal role in the implementation of electronic payment system. The payment and settlement system works efficiently and smoothly if is maintained by a sound legal framework. The major step in this direction is the enactment of the Payment and Settlement Act of 2007. The payment and Settlement Act, 2007 was declared in 2007 but came into effect on August 12, 2008. The Act authorizes Reserve Bank of India to regulate and supervise the payment system in India. In India, the payment and settlement system is regulated by the Payment and Settlement Act of 2007. History Of The Legislation The Payment and Settlement draft Bill was prepared in 2002 under the chairmanship of Dr. RH Patil. The committee was formed by the Reserve Bank of India to examine the various aspects of the payment system related to the legal basis of the system. The terms of reference of the committee set up by the Reserve Bank of India were as follows:- [6] à ¢Ã¢â€š ¬Ã…“To examine the adequacy of legal basis for payment system; To suggest appropriate legislative changes for regulation of payment systems; To suggest an administrative set-up within the bank for administering regulation and supervision of payment systems; Any other related matter.à ¢Ã¢â€š ¬Ã‚ [7] Finally the R H Patil committee examines the Payment and Settlement Systems Bill prepared by the Task Force on legal issues of the National Payment Council to proffer advice on matters relating to payment systems. [8] The Payment and Settlement bill was composed in 2002 but it was introduced in the Parliament in 2006. The Act came into the declaration in December by receiving the assent of the President and finally it is enforced on August 12, 2008. Payment And Settlement Act 2007 à ¢Ã¢â€š ¬Ã¢â‚¬Å" Critical Study The Act constitute of the eight chapters and thirty- eight sections. Two regulations have been notified by the Reserve Bank of India in 2008 under the Payment and Settlement Act. These regulation are;- Board for Regulation and Supervision of Payment and Settlement System Regulations 2008 (BPSS). Payment and Settlement Systems Regulations (2008).[9] The BPSS Regulation cover: Composition of the Board; Functions and powers of the Board; Powers to be exercised on behalf of the Board; Constitution of sub- committees. Settlement System Regulations cover the following: Authorization of payment systems including submission of application for authorization for commencing or carrying on a payment systems, grant of authorization certificates, certificate formats, etc.; Payment instructions and determination of standards; Furnishing of returns, documents and other information; Furnishing of audited balance sheets, etc.[10] Objective Behind The Payment And Settlement Act The payment and settlement system considered to be the backbone of the financial sector of our country. Gradually the financial sector has been progressing and has undergone change in the payment transfer from paper- based clearing to the Real Time Gross Settlement. The electronic payment system is developed to facilitates non- cash mode of payment. There are several retail payment system operated in India like manual paper-based clearing, Electronic Fund Transfer System, card-based system, MICR Clearing etc. The Reserve Bank of India operates and manages the paper- based cheque processing across India at four places which includes Delhi, Mumbai, Chennai and Kolkata. In addition to these places it is managed by twelve centers which are operated by public sector under the supervision of the Reserve Bank of India. The other centers involved are the clearing house, which are voluntary bodies of bank who get involved expressly to for t he purpose of clearing payment system and following the instruction given by the Reserve Bank of India. The Electronic Transfer System is defined under the Payment and Settlement Act as à ¢Ã¢â€š ¬Ã…“Electronic Fund Transfer (EFT) is a system whereby anyone who wants to make payment to another person/company, etc., can approach his bank and make cash payment or give instructions/authorization to transfer funds directly from his own account to bank account of the receiver/beneficiary. Complete details such as the receivers name, bank account number, account type (savings or current account), bank name, city, branch name, etc., should be furnished to the bank at the time of requesting for such transfers so that the amount reaches the beneficiaries account correctly and faster. RBI is the service provider for EFT.à ¢Ã¢â€š ¬Ã‚ [11] The Real Time Gross Settlement System (RTGS) for the large à ¢Ã¢â€š ¬Ã¢â‚¬Å" value payment system is operated by the Reserve Bank of India. The Ca rd Based System is not operated by the Reserve Bank of India but it is indirectly operated and regulated by the card issuing bank. Under the section 58(2)(p) of the Reserve Bank of India Act of 1934, the Central Board of Directors Of the Reserve Bank of India is authorized to prepare regulations for clearing house of banks. Therefore because of the above mentioned reasons and the pivotal role played by the Reserve Bank of India it was proposed that there should be some legislation which will empower the Reserve Bank of India to act as a designating authority and to bestowed with the following powers and functions; It is the responsibility to RBI to check the payment and settlement system across the country including card companies, Clearing Corporation of India etc. The RBI should lay down the procedure for authorization of payment system and also for the revocation of the payment system. The RBI should give directions and guidelines to system providers. The RBI should maintain operational and technical standards for payment system. To call for information and furnish returns and documents from the service providers. To audit and inspect the systems and premises of the system providers To make legislation for carrying out the provision of the proposed legislation To impose fines and penalties for not providing information or documents or wrongfully disclosing information, etc.[12] Finally the Bill was passed by the Parliament seeking to achieve above mentioned objects. Designated Authority And Its Committee Chapter 2 of the Act contains the section 3 which deals with authorities designated by this Act. Under this section, the Payment and settlement Act designates the Reserve Bank of India as the authority for the supervision and regulation of payment system. It also provides for the constitution of the committee of the Central Board of Directors of the Reserve Bank of India. Board For Regulation And Supervision Of Payment And Settlement System (BPSS) The board for regulation and supervision of payment and settlement system is constituted under the section 3(2) of the Act for the regulation and supervision of the payment system. The board constituted shall consist of the following members; Governor, Reserve Bank, who shall be the chairperson of the board; Deputy Governors, Reserve Bank, out of whom the Deputy Governor who is in- charge of the Payment and Settlement System, shall be the Vice- President of the Board; Not exceeding three Directors from the Central Board of the Reserve Bank of India to be nominated by the governor, Reserve Bank.[13] Powers and functions of the Board:- Board should lay down the policies for the regulation and supervision of the payment and settlement system. Board should lay down the standards for existing as well as for the future payment and settlement system. The authorization of payment and settlement system. The board to decide the criteria for membership of payment and settlement system. Board to examine the rule and regulations framed under any statutes for giving direction from time to time. Board should take major and effective steps for proper regulation and supervision of the payment and settlement system. The board should create the essential administering structure within the existing rules and regulations for effective regulation and supervision of the payment and settlement system. The BPSS meets regularly and gives direction for bringing in efficiency, safety and customer convenience in the payment and settlement systems. There are several areas in which BPSS has provided direction such as; preparation of a framework for payment through mobile phones, extension of the jurisdiction of magnetic ink character recognition (MICR), clearing house and computerization of non- MICR clearing houses, launching the Indo- Nepal remittance system, making use of electronic mode of payment mandatory for large value transaction, making all RTGS branches NEFT enabled- while upgrading the NEFT system into a round- the à ¢Ã¢â€š ¬Ã¢â‚¬Å" clock type remittance system, exploring the feasibility of of developing a domestic card to inject competition in the market in a non- discriminatory manner, facilitating optimum use of ATMà ¢Ã¢â€š ¬Ã¢â€ž ¢s by cash withdrawal.[14] Authorization Of Payment System Chapter 3 deals with the authorization of payment system. Section 4 of the Act states that no person can operates the payment system without obtaining authorization from Reserve Bank of India. Under the Act the RBI is empowered to act as designating authority to regulates and supervise the payment system. Section 4 conveys that person can operates the payment and settlement system after obtaining authorization from the RBI. The Reserve Bank of India can authorizes a person to operate or regulate the existing houses or new clearing houses of banks in order to have a common retail clearing house throughout the country.[15] Under section 5 of the Act person who wants to operate the payment system can apply for authorization. The application for the authorization should be [1] M.L. Tannan, Tannanà ¢Ã¢â€š ¬Ã¢â€ž ¢s Banking Law And Practice In India 354 (25th ed. Lexis Nexis Butterworths Wadhwa 2012) [2] M.A. Rashid, Law Relating To Electronic Transfer Of Money 11 (1st ed. Lexis Nexis Butterworths Wadhwa 2010) [3] N.S. Toor, Handbook Of Banking Information 58 (31st ed. Skylark Publications 2010) [4] M.L. Tannan, Tannanà ¢Ã¢â€š ¬Ã¢â€ž ¢s Banking Law And Practice In India 355 (25th ed. Lexis Nexis Butterworths Wadhwa 2012) [5] Ibid [6] M.A. Rashid, Law Relating To Electronic Transfer Of Money 11 (1st ed. Lexis Nexis Butterworths Wadhwa 2010) [7] Ibid [8] N.S. Toor, Handbook Of Banking Information 58 (31st ed. Skylark Publications 2010) [9] supra note 6 [10] Ibid [11] Payment and Settlement Act, 2007 2(c) [12] supra note 2 [13] Payment and Settlement Act of 2007 3(2). [14] M.L. Tannan, Tannanà ¢Ã¢â€š ¬Ã¢â€ž ¢s Banking Law And Practice In India 354 (25th ed. Lexis Nexis Butterworths Wadhwa 2012) [15] Payment a nd Settlement Act of 2007 4(2)

Walt Whitman And Robert Frost s A Noiseless Patient Spider

When one thinks of spiders, fury bodies, long legs and fangs comes to mind. Spiders are often characterized as a violent insect. They, however, have a deeper meaning. What you see is not always what it appears to be. The spider is an â€Å"ancient symbol of mystery, power and growth†¦just ask the spider weaves a web, so too must we weave our own lives† (Spider Symbol 1). The choices we make fabricate our lives; the spider chooses where to lay its web and how to connect each thread. Some of the most well-known poets, Walt Whitman and Robert Frost, display the spider in this light. Walt Whitman’s â€Å"A Noiseless Patient Spider† varies greatly from Robert Frost’s â€Å"Design†. Whitman stresses the importance of the title by repeating it in the first line of the poem. The title suggests the work and patience required of a spider to create their web, making each line connect to the next. The spider’s web is like one’s home, oneâ⠂¬â„¢s foundation, and one’s intricate connection to life. In the first line of the poem Walt Whitman uses a form of figurative language to describe the spider. The form of figurative language Whitman uses is personification. He gives the spider the human characteristic of being patient to suggest that this story is not only about a spider. The second to third line reads, â€Å"I mark’d where on a little promontory it stood isolated, Mark’d how to explore the vacant vast surrounding†¦Ã¢â‚¬  The words isolated, vacant and vast describe the space around the spider. The author wants

Earnings Qantas Airways Limited

Question: Discuss about the Earnings Qantas Airways Limited. Answer: Introduction: Qantas Airways Limiteds financial performance has improved in the financial year 2016 as compared to the previous year, which is depicted in the increase in the return on invested capital. The company has reported a return on invested capital of 22.70% for the financial year 2016, which is greater than that reported for the year 2015 (Qantas, 2016). In the year 2015, the company reported a return on invested capital of 16.20%. The return on invested capital has been computed by dividing the earnings before interest and tax (EBIT) by average invested capital. Thus, the increase in the return on invested capital could be attributed to the increase in EBIT or reduction in the average invested capital (Bernstein, 2004). In the current case of Qantas, both the factors such as increase in EBIT and reduction in average capital employed have contributed to the increase in the return on invested capital. The EBIT was observed to be $1,476 million for the year 2015, which increased to $2,009 million in the year 2016. Further, the average invested capital was observed to be $9,091 million for the year 2015, which reduced to $8,857 million in the year 2016 (Qantas, 2016). The combined impact of increase in the EBIT and the reduction in the average invested capital caused substantial increase in the return on invested capital in the year 2016. The increase in the EBIT indicates improvements in the operational performance of the company in the year 2016. The primary reason for improvement in the operational performance has been observed to be increase in the revenues. The revenues of the company increased from $15,816 million in the year 2015 to $16,200 million in the year 2016 (Qantas, 2016). In addition to this, there have been observed a reduction in the operating cost as well. The major reduction was found to be in fuel cost, which reduced from $3,937 million in the year 2015 to $3,250 million in the year 2016 (Qantas, 2016). Further, the reduction in the average invested capital also caused improvement in the operational performance of the company. In the regard, the major improvement was observed in the managing receivables. The accumulation in receivables went down from $1093 million in the year 2015 to $929 million in the year 2016. Further, slight increases in the liabilities such as payables and advance revenues helped in optimizing the invested capital, which ultimately caused enhancement in the return on invested capital (Bernstein, 2004). Cost of Debt for Qantas Amount ($M) Amount ($M) Interest bearing debt 2015 Current 771.00 Non-Current 4,791.00 Total 5,562.00 Interest bearing debt 2016 Current 441.00 Non-Current 4,421.00 Total 4,862.00 Average level of debt for 2016 5,212.00 Total Interest paid out in 2016 284.00 Cost of Debt (Interest paid/Average level of debt 2016) 5.45% The market value of shares is taken as the weight of equity in the computation of WACC. Therefore, the average equity level has been calculated based on the market value of shares as shown below: Market Value of share capital of Qantas Share Capital Market Value on 01.07.2015 No of Shares (million) 2,205 Share Price on 01.07.2015 3.26 Market Value (A) ($M) 7,187.40 Share Capital Market Value on 31.06.2016 No of Shares 2,083 Share Price on 31.06.2016 2.82 Market Value (B) ($M) 5,874.05 Average Equity Levels for 2016 2016 ($M) 2015 ($M) Market Value of Shares 5,874.05 7,187.40 Treasury Shares (50.00) (7.00) Reserves (220.00) (66.00) Retained Earnings (100.00) (1,115.00) Total Equity 5,504.05 5,999.40 Average Equity for 2016 5,751.73 Cost of Equity for Qantas: Using CAPM Model Description Rate Remarks A. Risk free rate 1.77% Based on 5 years bond yield (Bloomberg, 2016) B. Market return 7.18% Based on average annual returns on ASX 200 (refer appendix-B) C. Beta of Qantas 0.86 Computed variance and covariance of returns (refer appendix-A) CAPM 6.40% Weighted average cost of capital Weight Cost Weighted Average Debt 0.48 5.45% 0.026 Equity 0.52 6.40% 0.034 WACC 5.95% The return on invested capital is the return earned by the company on the amount of capital or resources used in earning that return. The weighted average cost of capital (WACC) is the return that the investor may desire from the company to earn. Thus, the weighted average cost of capital designates the investors expectations from the company (Brigham and Daves, 2014). In case of Qantas, the company earned after tax return on invested capital of 15.90%, while the weighted average cost of capital is worked out to be 5.95%. This indicates that the company is earning more than the investors expectations. Therefore, the return on invested capital of 15.90% is very much acceptable from the investors perspective. The company is following policy of paying dividend and buying the shares back from the shareholders. This policy of the company seems to be inappropriate in the given circumstances because the company is earning more than the investors expectations. In such circumstances, the company should retain the profits and reinvest the same in the operations rather than distributing as dividend to the shareholders. On the same grounds the company is advised to stop buy back of the shares also. References Qantas. 2016. Preliminary Final Report for the Financial Year Ended 30 June 2016. [Online]. Available at: https://investor.qantas.com/FormBuilder/_Resource/_module/doLLG5ufYkCyEPjF1tpgyw/file/full-year-results/preliminaryFinalReport16.pdf [Accessed on: 20 September 2016]. Bernstein. 2004. Analysis of financial statement. Tata McGraw-Hill Education Brigham, E.F. and Daves, P.R. 2014. Intermediate financial management. Cengage Learning. Bloomberg. 2016. Australian bond rates. [Online]. Available at: https://www.bloomberg.com/markets/rates-bonds/government-bonds/australia [Accessed on: 20 September 2016].

So I Write free essay sample

The pen is loudest when our voice is silent. Every writer has their inspiration, their muse. They write to spin a story, to get an idea or point across, I write to speak. Living in a home that feels more like a barless prison; where you have little to no voice on matters of your own life, takes a toll. So I write. The thoughts that keep trying to push their way out of my mouth and fly free in the air, flow freely onto my paper. My pen is louder than my voice ever was. Thoughts that I only wish I could tell my mom, are stopped by a wall called culture. Speaking out against her for defending my own beliefs would be interpreted as disrespectful. So I remain silent, not daring to utter a sound. All I can do is wait until I’m able to spread my wings and finally feel the freedom and independence I’ve craved for for so long. We will write a custom essay sample on So I Write or any similar topic specifically for you Do Not WasteYour Time HIRE WRITER Only 13.90 / page Until then, I write. It seems that as I grew older, the worse my home seemed to me. It felt like the walls shrunk, little by little, almost like it was trying to suffocate me. The one sided yelling matches between my mom and I grew more frequent as I gathered more courage to speak out, but it wasn’t enough. She always found some way to stop me before I even got started. I was learning to speak out against her, albeit a little late, but better than never. My writing got shorter as some of my thoughts were voiced. As I wrote, my world expanded without my knowing. I went back and reread some of the things I had written, and realized that my thoughts had changed and shifted their focus. Instead of writing about my prison-like home I began to write about the world. Interacting with my friends and finding out their views on subjects got me thinking about what my views were. I slowly turned my attention away from my own problems, and started thinking about the hardships that others go through. What was once an outlet for my unspoken thoughts and silent words is now a way in which I record what I learn about the world through my own eyes and of the others around me. As Henry David Thoreau once said, â€Å"How vain is it to sit down to write, when you have not stood up to live?†. Now I sit down to write what I have lived to see, and let my voice be louder than my pen as it should be.