04 KALEIDOSCOPE ERGO Monday, April 27, 2009

Ask your query

EVERY DAY
WILL BE
My friend’s car met with an accident a
few days ago. A bus rammed into the rear
side of the car. He has been going to the
police station to get an FIR so that he can
claim the damage from his insurance
company. Is there a faster way to get
things moving?

‘INTEREST’ING
T. Somasundaram, Vellore
Dear Somasundaram,
Your friend does not need any police
FIR or complaint letter for claiming the
insurance. All that he/she needs to do is to
call up the insurance company and inform
about the accident and fill up a claim form
describing the incident. It is as simple as
that. All general insurance companies fol-
low the same policy. The insurance policy
will have a call center number where you
need to inform. They will arrange for a
surveyor to come and inspect the vehicle.
RBI directs banks to calculate interest rate
In fact they will send the surveyor to your
garage at their own cost. A police com- on a daily basis from 01 April 2010
plaint or FIR is only needed if there is any
third party damage to property or life. Also
in case there is any loss of life in the in-
cident an FIR will surely be needed for
claiming both the general insurance as
well as Life insurance damages. PRADEEP YUVARAJ current inflation and what
Do you need some unbiased and pradeep@finerva.com other investments return. But,
professional solutions to your personal any interest on idle money is a

finance issues related problems? Ask Doctor
Finergo. Mail your queries to
finergo@goergo.in, Put subject as Doctor.
Mini Quiz
Q1: Which agency frames the Annual Pol-
icy document relating to the Economy?
a.RBI
b.Finance Ministry
c.Economic Affairs committee
d.State Bank of India
Q2: Which blue chip company recently
declared a 1:1 bonus?
a.Wipro
b.Satyam
c.Indian Oil
d.TCS
Send your answers to finergo@goergo.in or
SMS your answers to 92813 98889. For
example if you choose A as the answer to
question 1 and B as the answer to question 2
type it as 1A2B and send it. Winner will be
chosen by lucky draw from all correct
answers.
Answers for last week’s mini-quiz
1.950000
2.National Stock Exchange
I
n a “small investor” friend-
ly move, the Reserve Bank
of India in its Annual Pol-
icy Statement for 2009-
2010 has instructed banks to
calculate interest rates on
your money kept in savings
accounts on a daily basis rath-
er than the current practice of
calculating interest on savings
bank accounts on the mini-
mum balances held in the ac-
counts during the period from
the 10th day to the last day of
each calendar month.
Benefit to you: the current
rate of interest prescribed by
the RBI is 3.5% per annum.
But most of the account hol-
ders rarely get to earn this in-
terest as the minimum
balance is the basis of interest
calculation. Thus for example
even if your account had a
balance of Rs. 75,000 from
10th to 29th and you withdrew
Rs 74,500/- on 30th and re-de-
posited it on 31st, the interest
would be calculated only on
Rs 500. If you had not with-
drawn you would have re-
ceived Rs 218.75 as interest
but what you actually get is
only Rs 17.5.
Although on a broad basis,
both the amounts look ridicu-
lously low; considering the
bonus and especially since all
of us need to have some liquid
cash at our disposal.
Benefits to the banks: the
new system will initially lead
to a higher cost of payout for
banks, but on the long run
more and more customers
will retain money in savings
account thus reducing the de-
pendence of banks on
deposits.
The second benefit would
also be that NRI accounts
could see higher inflows and
banks in most countries do
not even give 2% interest.
Why now? This decision by
the RBI has been easily ac-
cepted by banks and IBA (In-
dian Bank’s Association) as
the level of automation is very
The decision by the high now and it’s easier to ex-
ecute the calculations.
RBI has been easily What should you do? Com-
bined with that fact that you
accepted by banks and can use any bank’s ATM free
IBA (Indian Bank’s of cost, this new directive can
help you earn some money on
Association) as the level idle cash lying at your house.
of automation is very It even makes sense to de-
posit you piggy bank money
high now and it’s into an SB account and just
keep a bare minimum in cash
easier to execute in hand.
the calculations. After all better something
than nothing. ■