- #80, 6th cross 2nd main widia layout, Viyaynagar
Marian Jane Adentwi, c/o Bayport financial services, Osu Badu Street airport west Accra Ghana West Africa - +919980465120
KWADWO BOATENG
Bangalore University, Canara bank school of management studies, Graduate Student
- Universidad Empresarial de Costa Rica, Financial Management, Graduate Studentadd
- I recently completed my Ph.D. in Management (finance option) and ready to embark on my teaching and researcher journe... moreI recently completed my Ph.D. in Management (finance option) and ready to embark on my teaching and researcher journey in the field of business management. My doors are open to any university or college that is willing to give me the opportunity to put my over a decade of industry experience into practice.edit
The problem of growing NPLs in the West African sub-region has been a great concern to both academics and industry players in the banking sector. However, despite the significance of the subject matter, less attention has been paid to... more
The problem of growing NPLs in the West African sub-region has been a great concern to both academics and industry players in the banking sector. However, despite the significance of the subject matter, less attention has been paid to this area of bank-specific and macroeconomic determinants of NPLs, especially in the Anglo-West-African sub-region. This study fills the gap and provides useful recommendations to the managers of both the respective country's economy and the banks in the sub-region. The study aimed to investigate bank-specific and macroeconomic variables that determine the level of NPLs in Anglo-West African banks. A total of 31 banks from the 5 Anglophone countries in the sub-region namely, 10 banks from Nigeria, 10 from Ghana, 5 from Sierra Leone, 4 from Liberia, and 2 from Gambia. Multiple regression was employed to analyse the secondary data collected from the annual reports of the sampled banks. The bank-specific variables employed in the study included the ROA, CAR, Leverage ratio, credit growth, and liquidity whereas the macroeconomic variables were CPI-inflation, real interest rate, and GDP growth rate. The study revealed that ROA and credit growth are the most significant bank-specific determinants of NPLs in the sub-region. The two variables negatively impacted the NPLs of the Anglo-West African banks. All the macroeconomic variables were significant determinants of NPLs in the sub-region.
Research Interests:
This paper takes a look at some policies and programs initiated by the Indian government which aimed at fostering financial inclusiveness. According to the 2017 Global inclusive development Index, India's economy still ranks 60 th... more
This paper takes a look at some policies and programs initiated by the Indian government which aimed at fostering financial inclusiveness. According to the 2017 Global inclusive development Index, India's economy still ranks 60 th which call for strengthening of the existing financial inclusion policies and rolling out more of such programs. Financial inclusion has become an evolving paradigm of economic growth that plays very significant role in poverty alleviation. To achieve an inclusive growth, the marginalized sections of the society must be brought into the mainstream by extending financial products and services to their doorstep. Since there is no specific financial inclusion indicator, several indicators are used concurrently in trying to measure the level of inclusiveness in countries across the globe. This paper therefore takes a look at some of the policies the Indian government has initiated towards the attainment of financial inclusion. The progress of these financial inclusion policies and the impact it has so far made since their implementation was reviewed. The progress and impact of policies such as Pradhan Matri Jan Dhan Yojana (PMJDY), digital India, financial literacy, and priority lending were examined. It was found out that due to these recent policies, many marginalized people who at the normal circumstances will not have access to financial services have been brought into the mainstream banking. The progress and the success of PMJDY and digital India for instance have been overwhelmingly encouraging.
Research Interests:
The research was conducted to examine the relational impact of operational efficiency in Ghanaian Banks. The study was necessitated from the fact that efficiency lapses have led to the revoking of banking licenses of 7 banks within a... more
The research was conducted to examine the relational impact of operational efficiency in Ghanaian Banks. The study was necessitated from the fact that efficiency lapses have led to the revoking of banking licenses of 7 banks within a financial year (2017/2018). the dataset was compiled from the annual reports of 9 banks for a 9 year period. Ratios for profitability, management efficiency related variables, and employee productivity variables were computed for the analysis. The results of the analysis indicated that non-interest income margin, operating expenses to income ratio; profit per employee and business per employee are the most significant variables that affect the profitability of banks in Ghana.
Research Interests:
Research Interests:
The objective of the study was to assess the performance and contribution of MSMEs to both the Indian and the global economy. Secondary data were collected for analysis. The data was qualitatively analysed and presented in the form of... more
The objective of the study was to assess the performance and contribution of MSMEs to both the Indian and the global economy. Secondary data were collected for analysis. The data was qualitatively analysed and presented in the form of tables, and charts using Microsoft Excel. The Analysis of the data gathered confirmed that MSMEs serve as a catalyst to the evenly distribution of development and wealth in the country. It was also found that, even though all states and union territories have their share of the MSMEs, the states of Uttar Pradesh, West Bengal followed by Tamil Nadu, Maharashtra, Karnataka, Bihar, Andhra Pradesh, Gujarat, Rajasthan, and Madhya Pradesh, are the 10 states with the highest number of MSMEs. The findings again indicated that, MSMEs that engage in trade activities dominate the industry. In addition, as much as 51% of Indian MSMEs operates from the rural areas whereas 49% operates from the urban cities. The consistent growth of India’s economy cannot be mention...
Research Interests:
The primary aim of the study was to assess the performance of Ghanaian banks using the CAMELS rating model. The model is an acronym for capital adequacy, assets quality, management efficiency, earning, liquidity, and sensitivity. The... more
The primary aim of the study was to assess the performance of Ghanaian banks using the CAMELS rating model. The model is an acronym for capital adequacy, assets quality, management efficiency, earning, liquidity, and sensitivity. The rating is based on ratio analysis of the financial statements together with an onsite examination by the regulatory authority. A total of 10 banks were selected for a seven-year period. A standard multiple regression was employed in the study to analyse the effect the various components of the CAMELS model have on the performance of banks in Ghana. The findings from the analysis of the computed ratios from the financial statements of the selected banks indicated that Earning stood out as the highly significant factor that affects the performance of banks in Ghana. A percentage change in earning will result in a whopping 82.5% increment in bank performance measured by ROE. Capital adequacy, assets quality, management efficiency, and liquidity were equall...
Research Interests:
A merger can be explained as a combination of two or more companies into one giant company. Indian banking history cannot be written without mentioning Mergers and Acquisition. This study was conducted to assess the financial performance... more
A merger can be explained as a combination of two or more companies into one giant company. Indian banking history cannot be written without mentioning Mergers and Acquisition. This study was conducted to assess the financial performance of three selected merged banks (IDBI, HDFC, and ICICI) using the DuPont model. The paper compared the pre and post-merger performance based on parameters such as Profit margin, Asset yield, Financial leverage, Return on assets, and Return on equity. To ascertain whether there was an improvement in performance or not after the merger, a paired sample t-test was conducted. This study concluded that although mergers are supposed to bring synergy and economies of scale, companies should not expect instant improvement in all aspects of their performance indicators.
Research Interests: Finance and Accounting
Digital banking refers to the act of performing banking and financial transaction without the use of physical cash, coins or bills. The fundamental objective of the study was to find out the impact of digital banking on the profitability... more
Digital banking refers to the act of performing banking and financial transaction without the use of physical cash, coins or bills. The fundamental objective of the study was to find out the impact of digital banking on the profitability of deposit money banks in Ghana. Secondary data spanning from 2012 to 2018 were collected from the annual payment system reports of the central bank of Ghana. Cheque codeline clearing, Ghana automated clearing house, Ghana interbank settlements, Gh-Link, and mobile money payments in value were the independent variables. Return on assets (ROA) was the dependent variable employed in the study. Partial least square (PLS) regression was the statistical tool used for the analysis with the aid of Origin2018 scientific software.<br><br>The results of the study indicated that Gh-Link and E-zwich distinguished themselves from the rest of the variables by explaining 95.87% of the variations in the profitability of Ghanaian banks. It was further fo...
Research Interests:
This study is about finding out the causes and management of loan delinquency in the savings and Loans (S&L) companies in Ghana. Seven (7) S&L companies with 254 respondents were sampled for the study. It was found from the study that,... more
This study is about finding out the causes and management of loan delinquency in the savings and Loans (S&L) companies in Ghana. Seven (7) S&L companies with 254 respondents were sampled for the study. It was found from the study that, among the three main types of risks faced by banking institutions, credit risk was most prevalent in the day to day operations of the S&L companies in Ghana. It was again found that multiple borrowing was the highest cause of loan delinquency bedevilling the S&L companies. Further the findings indicated that provisioning for bad debt affects S&L companies most as a result of loan delinquency. Also, making use of the credit referencing bureaus was the most effective way of preventing loan delinquency. It has therefore been recommended that, the Central Bank of Ghana (BoG) should make it mandatory for all loan granting institutions to sign up and furnish the credit reference bureaus with details of all their disbursed loans for easy referencing.
The study examined the determinants of profitability of banks in India and Ghana. The main objective of the study was to find out the factors that make significant impact on profitability of banks in both India and Ghana and also the... more
The study examined the determinants of profitability of banks in India and Ghana. The main objective of the study was to find out the factors that make significant impact on profitability of banks in both India and Ghana and also the factors that make unique significant impact on profitability of banks in Indian but not Ghana and vice versa. Data from the financial statements of 10 banks from each country for 7 years period was used in the study. ROA was the profitability measure which served as the dependent variable. The independent variables were made up of bank specific and macroeconomic variables. The bank specific variables employed were; credit risk, liquidity, net interest margin, capital adequacy ratio, and bank size. Annual GDP growth rate and CPI-Inflation rate were the macroeconomic variables. Multiple regression was the statistical tool used in the analysis to ascertain the relationship between the dependent and the independent variables. The findings indicated that cre...
The main purpose of the paper was to examine the impact operational efficiency, and productivity has on the profitability of Ghanaian banks. Secondary data obtained from the annual financial reports of nine sampled banks for nine years... more
The main purpose of the paper was to examine the impact operational efficiency, and productivity has on the profitability of Ghanaian banks. Secondary data obtained from the annual financial reports of nine sampled banks for nine years was used for the study. Multiple regression was used for the analysis through SPSS version 23. The results of the analysis indicated that, the most significant variables that affect the profitability of banks in Ghana are net interest margin, non-interest income margin; operating expenses to income ratio; profit per employee; and business per employee. Equity to assets ratio and personnel expenses to operating expenses ratio on the other hand, had an insignificant relationship with the profitability of Ghanaian banks. The implication of the findings is that management should not rely on interest income as the sole source of revenue but rather put much effort in increasing revenue through non-interest income streams. The results again imply that Ghanai...
Research Interests:
The study was conducted to compare the efficiency levels of selected 12 public sector banks (PSBs) in India. Public sector banks are banks with more than 50% shares owned by the government. Data for seven years was compiled from the... more
The study was conducted to compare the efficiency levels of selected 12 public sector banks (PSBs) in India. Public sector banks are banks with more than 50% shares owned by the government. Data for seven years was compiled from the annual reports of these banks for computation of the efficiency ratios for the analysis. The ratios were grouped into management and employee efficiencies. The management efficiency ratios included net interest margin, non-interest income margin, and operating profit to total assets. The employee efficiency ratios on the other hand includes profit per employee, business per employee, wages to total expenses, and wages to total income. The results from the ANOVA analysis of the management efficiency measures indicated that all the 12 selected PSBs banks have unequal efficiency levels. The results from the ANOVA analysis of the employee efficiency measures also indicated that all banks have unequal level of employee efficiency with the exception of wages t...
Research Interests:
A merger can be explained as a combination of two or more companies into one giant company. Indian banking history cannot be written without mentioning Mergers and Acquisition. This study was conducted to assess the financial performance... more
A merger can be explained as a combination of two or more companies into one giant company. Indian banking history cannot be written without mentioning Mergers and Acquisition. This study was conducted to assess the financial performance of three selected merged banks (IDBI, HDFC, and ICICI) using the DuPont model. The paper compared the pre and post-merger performance based on parameters such as Profit margin, Asset yield, Financial leverage, Return on assets, and Return on equity. To ascertain whether there was an improvement in performance or not after the merger, a paired sample t-test was conducted. This study concluded that although mergers are supposed to bring synergy and economies of scale, companies should not expect instant improvement in all aspects of their performance indicators.
Research Interests: Finance and Accounting
Digital banking refers to the act of performing banking and financial transaction without the use of physical cash, coins or bills. The fundamental objective of the study was to find out the impact of digital banking on the profitability... more
Digital banking refers to the act of performing banking and financial transaction without the use of physical cash, coins or bills. The fundamental objective of the study was to find out the impact of digital banking on the profitability of deposit money banks in Ghana. Secondary data spanning from 2012 to 2018 were collected from the annual payment system reports of the central bank of Ghana. Cheque codeline clearing, Ghana automated clearing house, Ghana interbank settlements, Gh-Link, and mobile money payments in value were the independent variables. Return on assets (ROA) was the dependent variable employed in the study. Partial least square (PLS) regression was the statistical tool used for the analysis with the aid of Origin2018 scientific software. The results of the study indicated that Gh-Link and E-zwich distinguished themselves from the rest of the variables by explained 95.87% of the variations in the profitability of Ghanaian banks. It was further found that a positive relationship existed between cheque codeline clearing; Ghana automated clearing house, Ghana interbank settlement, GH-Link, and the profitability of Ghanaian Banks. Mobile money and E-zwich, on the other hand, had a negative relationship with the profitability of the banks. It was therefore recommended that the banks should make more efforts in the form of education and marketing to win more customers to patronise the digital banking products for profit maximization. The implication of this study is that policymakers henceforth will have a fair idea when formulating policies concerning Fintech in the future.
Research Interests:
The main purpose of the paper was to examine the impact operational efficiency, and productivity has on the profitability of Ghanaian banks. Secondary data obtained from the annual financial reports of nine sampled banks for nine years... more
The main purpose of the paper was to examine the impact operational efficiency, and productivity has on the profitability of Ghanaian banks. Secondary data obtained from the annual financial reports of nine sampled banks for nine years was used for the study. Multiple regression was used for the analysis through SPSS version 23. The results of the analysis indicated that, the most significant variables that affect the profitability of banks in Ghana are net interest margin, non-interest income margin; operating expenses to income ratio; profit per employee; and business per employee. Equity to assets ratio and personnel expenses to operating expenses ratio on the other hand, had an insignificant relationship with the profitability of Ghanaian banks. The implication of the findings is that management should not rely on interest income as the sole source of revenue but rather put much effort in increasing revenue through non-interest income streams. The results again imply that Ghanaian bank management should place emphasis on having lean employees size, and increase the banks' business by mobilizing more deposits and advancing more quality loans. Management should again ensure a reduction in operational expenditure through minimization of wastages and cost cutting to improve operational efficiency.
Research Interests:
This piece of research work aims at understanding the preferred emerging media options used for marketing by start-ups in India and Ghana. A start-up is a temporal organization that is searching for a scalable, and repeatable profitable... more
This piece of research work aims at understanding the preferred emerging media options used for marketing by start-ups in India and Ghana. A start-up is a temporal organization that is searching for a scalable, and repeatable profitable business model, which can be a partnership, a company, or temporal organization. There is an evidential proves to suggest that any business venture, be it an MNC or a growing organization in this era of information communication technology can never survive the test of time if it fails to leverage on the booming ICT to announce its presence. However, the question that arises is through which media type can this be possible? It is based on the above question that this research work is being carried out to ascertain the most used emerging media by start-ups for their marketing purposes in India and Ghana. A total of 30 start-up owners comprising of 15 from each country were sampled for the study through convenience and snowball sampling techniques. The data collected was analysed using charts, graphs, and tables. It was found that startups prefer electronic media to the traditional media for the marketing of its products and services. Among the electronic media, social media is used more by startups. Facebook, WhatsApp, LinkedIn, Twitter, Instagram, YouTube and Google+ were the most used.
Research Interests:
The study was conducted to compare the efficiency levels of selected 12 public sector banks (PSBs) in India. Public sector banks are banks with more than 50% shares owned by the government. Data for seven years was compiled from the... more
The study was conducted to compare the efficiency levels of selected 12 public sector banks (PSBs) in India. Public sector banks are banks with more than 50% shares owned by the government. Data for seven years was compiled from the annual reports of these banks for computation of the efficiency ratios for the analysis. The ratios were grouped into management and employee efficiencies. The management efficiency ratios included net interest margin, non-interest income margin, and operating profit to total assets. The employee efficiency ratios on the other hand includes profit per employee, business per employee, wages to total expenses, and wages to total income. The results from the ANOVA analysis of the management efficiency measures indicated that all the 12 selected PSBs banks have unequal efficiency levels. The results from the ANOVA analysis of the employee efficiency measures also indicated that all banks have unequal level of employee efficiency with the exception of wages to income ratio, which was equal among the banks. It was therefore recommended, that public sector banks in India must improve upon both management and employee efficiencies of their respective banks in order to increase productivity and for that matter profitability.
Research Interests:
The objective of the study was to assess the performance and contribution of MSMEs to both the Indian and the global economy. Secondary data were collected for analysis. The data was qualitatively analysed and presented in the form of... more
The objective of the study was to assess the performance and contribution of MSMEs to both the Indian and the global economy. Secondary data were collected for analysis. The data was qualitatively analysed and presented in the form of tables, and charts using Microsoft Excel. The Analysis of the data gathered confirmed that MSMEs serve as a catalyst to the evenly distribution of development and wealth in the country. It was also found that, even though all states and union territories have their share of the MSMEs, the states of Uttar Pradesh, West Bengal followed by Tamil Nadu, Maharashtra, Karnataka, Bihar, Andhra Pradesh, Gujarat, Rajasthan, and Madhya Pradesh, are the 10 states with the highest number of MSMEs. The findings again indicated that, MSMEs that engage in trade activities dominate the industry. In addition, as much as 51% of Indian MSMEs operates from the rural areas whereas 49% operates from the urban cities. The consistent growth of India's economy cannot be mentioned without acknowledging the contribution of the MSMEs. The MSMEs sector contributes as much as between 40 and 50 per cent of India's total export. Again, an average of 30% share of the Gross Domestic Product (GDP) of India is contributed by the MSMEs sector, and an average of 32% to the Gross Value Added (GVA). The MSMEs sector is credited with about 40% of the total employments in the country during the study period. Out of these created employments, 55% are found in the urban cities whereas 45% emanates from the rural areas with 76% of them being male whiles 24% are female.
Research Interests:
The primary aim of the study was to assess the performance of Ghanaian banks using the CAMELS rating model. The model is an acronym for capital adequacy, assets quality, management efficiency, earning, liquidity, and sensitivity. The... more
The primary aim of the study was to assess the performance of Ghanaian banks using the CAMELS rating model. The model is an acronym for capital adequacy, assets quality, management efficiency, earning, liquidity, and sensitivity. The rating is based on ratio analysis of the financial statements together with an onsite examination by the regulatory authority. A total of 10 banks were selected for a seven-year period. A standard multiple regression was employed in the study to analyze the effect the various components of the CAMELS model have on the performance of banks in Ghana. The findings from the analysis of the computed ratios from the financial statements of the selected banks indicated that Earning stood out as the highly significant factor that affects the performance of banks in Ghana. A percentage change in earning will result in a whopping 82.5% increment in bank performance measured by ROE. Capital adequacy, assets quality, management efficiency, and liquidity were equally found to be significantly affecting the performance of Ghanaian banks. Sensitivity, on the other hand, was found to be the only insignificant factor of the CAMELS model that affects the performance of banks in Ghana.
Research Interests:
The paper analyzes how bank specific and macroeconomic variables affect the profitability of savings and loans (S&L) companies in Ghana. The bank specific (internal) determinants data was collected from the financial statements of the S&L... more
The paper analyzes how bank specific and macroeconomic variables affect the profitability of savings and loans (S&L) companies in Ghana. The bank specific (internal) determinants data was collected from the financial statements of the S&L companies from 2011 to 2016 whereas the macroeconomic (external) determinants were sourced from the central bank of Ghana. The bank specific variables chosen for the study were capital adequacy ratio, non-performing loan ratio, loans and advances to deposit ratio and size of bank. The macroeconomic variables included were annual GDP growth rate and CPI-inflation rate. Data were analyzed using SPSS software and multiple regression model was used to find out the relationship between profitability and the internal and external determinants. Capital Adequacy, Non-performing Loans, Bank size, Inflation and GDP growth rate all negatively influenced profitability of savings and loans companies in Ghana. The only variable found to positively influence S&Ls profitability was Loans and Advances. Researchers have made different findings with regard to profitability determinants of banks which makes the findings inconclusive. We therefore recommend further research on profitability determinants banks especially, in the Savings and Loans sub banking sector.
Financial inclusion is a measure of the proportions of individuals and firms that use formal financial services. It serves as a vehicle for poverty alleviation and the driving force for the achievement of the global sustainable... more
Financial inclusion is a measure of the proportions of individuals and firms that use formal financial services. It serves as a vehicle for poverty alleviation and the driving force for the achievement of the global sustainable development goals (SDGs). The purpose of this study was to find out the progress achieved pertaining to financial inclusion in Ghana. The government of Ghana has for the past years consciously put in place policies and programs to facilitate the promotion of financial inclusion. These policies have resulted to rapid expansion of the banking sector thereby making formal financial services accessible to all. The expansion of bank branches, ATM coverage, increment in Debit/Credit cards ownership and mobile money account holders are indications of achievement in the financial inclusion agenda. An estimated 83.1% of Ghanaians have mobile money account, which has taken savings and other forms of financial services to the doorstep of the ordinary citizen. This has also resulted to a rise in the level of making/receiving payment digitally from 22% in 2014 to 44% in 2017 among rural dwellers. Bank branches coverage per 100,000 adults has grown from 4.8 in 2008 to 7.2 in 2016. Because of the branch visibility, account ownership has also seen a surge especially, in the rural areas where it used to be minimal. Although there has been some success, there is the need for the government to continue with the provision of an enabling environment for faster progress since achievement of financial inclusion enhances stability and faster economic growth.
The study examined the determinants of profitability of banks in India and Ghana. The main objective of the study was to find out the factors that make significant impact on profitability of banks in both India and Ghana and also the... more
The study examined the determinants of profitability of banks in India and Ghana. The main objective of the study was to find out the factors that make significant impact on profitability of banks in both India and Ghana and also the factors that make unique significant impact on profitability of banks in Indian but not Ghana and vice versa. Data from the financial statements of 10 banks from each country for 7 years period was used in the study. ROA was the profitability measure which served as the dependent variable. The independent variables were made up of bank specific and macroeconomic variables. The bank specific variables employed were; credit risk, liquidity, net interest margin, capital adequacy ratio, and bank size. Annual GDP growth rate and CPI-Inflation rate were the macroeconomic variables. Multiple regression was the statistical tool used in the analysis to ascertain the relationship between the dependent and the independent variables. The findings indicated that credit risk, net interest margin, capital adequacy and inflation were the most important factors that significantly affect profitability of banks in both Ghana and India. Cost to income ratio and bank size had an insignificant impact on profitability of Indian banks but impacted significantly on Ghanaian bank's profitability. It has therefore been recommended that strict compliance of capital adequacy requirement must be enforced by the regulatory bodies in both countries. Also prudent credit risk management practices must be adhered to by managers of banks in both countries. Again as the size of bank increases, internal control measures must be strengthened by managers of banks in both countries in order to minimize excessive cost of operation.
This study is about finding out the causes and management of loan delinquency in the savings and Loans (S&L) companies in Ghana. Seven (7) S&L companies with 254 respondents were sampled for the study. It was found from the study that,... more
This study is about finding out the causes and management of loan delinquency in the savings and Loans (S&L) companies in Ghana. Seven (7) S&L companies with 254 respondents were sampled for the study. It was found from the study that, among the three main types of risks faced by banking institutions, credit risk was most prevalent in the day to day operations of the S&L companies in Ghana. It was again found that multiple borrowing was the highest cause of loan delinquency bedevilling the S&L companies. Further the findings indicated that provisioning for bad debt affects S&L companies most as a result of loan delinquency. Also, making use of the credit referencing bureaus was the most effective way of preventing loan delinquency. It has therefore been recommended that, the Central Bank of Ghana (BoG) should make it mandatory for all loan granting institutions to sign up and furnish the credit reference bureaus with details of all their disbursed loans for easy referencing.
Abstract The union government of India decided to demonetize high value currency notes of denomination of ₹ 1000 and ₹ 500, valued at ₹ 15.4 trillion, which constituted 86.9% of the value of total currency in circulation. (RBI report... more
Abstract
The union government of India decided to demonetize high value currency notes of denomination of ₹ 1000 and ₹ 500, valued at ₹ 15.4 trillion, which constituted 86.9% of the value of total currency in circulation. (RBI report March 10, 2017). The decision was aimed at eliminating corruption, black money, counterfeit currency and terror funding, and also reaping its enormous potential medium-term benefits in the form of reduced corruption, Cashless economy, increased flow of financial savings, and greater formalization of the economy in order to achieve higher GDP growth and tax revenues that could be used by the Government for inclusive and stronger economic growth.
The purpose of this paper is to evaluate the successfulness or otherwise of demonetization after its implementation. An analyses of secondary data on some economic growth indicators such as Inflation, Equity markets, growth in Banks, NBFCs, NBFIs, and the growth in digital transactions was conducted.
The findings indicated that, Inflation was not significantly affected. The banking sector saw a growth in deposits in both CASA and the ‘infamous’ Jan Dhan Accounts which lead to a reduction in term deposit rate. Lending rates too fell due to the cheap source of funding.
Mutual funds saw an increase in inflows in income/debt schemes. LIC of India made a record premium collection of more than 140% in November y-o-y. NBFCs were affected in the volume of loan disbursement but repayment of loans went up. Digital transactions also went up post demonetization.
India’s demonetization compared to the experiences of other countries that embarked on similar move can be described as a success since it has achieved its aim of increasing digital transactions, improving savings culture, controlling inflation, reducing lending rates, and curbing counterfeiting.
KEYWORDS: Demonetization, Digitization, Inflation, BSE Sensex, NBFCs.
The union government of India decided to demonetize high value currency notes of denomination of ₹ 1000 and ₹ 500, valued at ₹ 15.4 trillion, which constituted 86.9% of the value of total currency in circulation. (RBI report March 10, 2017). The decision was aimed at eliminating corruption, black money, counterfeit currency and terror funding, and also reaping its enormous potential medium-term benefits in the form of reduced corruption, Cashless economy, increased flow of financial savings, and greater formalization of the economy in order to achieve higher GDP growth and tax revenues that could be used by the Government for inclusive and stronger economic growth.
The purpose of this paper is to evaluate the successfulness or otherwise of demonetization after its implementation. An analyses of secondary data on some economic growth indicators such as Inflation, Equity markets, growth in Banks, NBFCs, NBFIs, and the growth in digital transactions was conducted.
The findings indicated that, Inflation was not significantly affected. The banking sector saw a growth in deposits in both CASA and the ‘infamous’ Jan Dhan Accounts which lead to a reduction in term deposit rate. Lending rates too fell due to the cheap source of funding.
Mutual funds saw an increase in inflows in income/debt schemes. LIC of India made a record premium collection of more than 140% in November y-o-y. NBFCs were affected in the volume of loan disbursement but repayment of loans went up. Digital transactions also went up post demonetization.
India’s demonetization compared to the experiences of other countries that embarked on similar move can be described as a success since it has achieved its aim of increasing digital transactions, improving savings culture, controlling inflation, reducing lending rates, and curbing counterfeiting.
KEYWORDS: Demonetization, Digitization, Inflation, BSE Sensex, NBFCs.
Research Interests:
Peer-to-Peer (P2P) lending is an online platform where the lending companies match the lenders and borrowers. It is part of alternative finance and crowdfunding. The paper is theoretical in nature and examined the development and progress... more
Peer-to-Peer (P2P) lending is an online platform where the lending companies match the lenders and borrowers. It is part of alternative finance and crowdfunding. The paper is theoretical in nature and examined the development and progress of P2P lending in a few leading economies. We found that in 2015, globally the P2P lending market grew by 271% against the previous year’s performance and is projective $1 trillion by the year 2025. With its regulation by RBI in September 2017, this industry has the capacity to boost the economy or wreak havoc on it if there are flaws in the regulatory framework
Research Interests:
This paper is about examining the impact of demonetization on the Indian economy through the analysis of some key economic indicators. The indicators factored in the analysis include: the GDP growth rate, CPI-Inflation rate, the Exchange... more
This paper is about examining the impact of demonetization on the Indian economy through the analysis of some key economic indicators. The indicators factored in the analysis include: the GDP growth rate, CPI-Inflation rate, the Exchange rate, Foreign Exchange Reserve, the stock market price and tax returns. The rest are: bank borrowings from RBI and credit advancements to customers, digital transactions, and Pradhan Mantri Jandhan yojana (PMJDY) scheme. The analysis was to find out whether the demonetization drive has had any impact on these economic indicators.
From the analysis, it emerged that GDP growth rate has been hampered by demonetization. CPI- Inflation was positively impacted as the rate has dropped post demonetization. The Exchange rate of Rupee to USD and the Japanese Yen has not been significantly affected but it has depreciated against the Pound and the Euro post demonization. Foreign Exchange Reserve which creates investor confidence in an economy was not impacted negatively post demonetization as it keeps on increasing year after year prior to and post demonetization. The stock market maintained its investor confidence and kept on appreciating whiles more taxpayers enrolled in to the tax net with about 10.1 million new entrants post demonetization. After demonetization more Indian citizens have signed up onto the digital platforms to conduct their daily banking transactions which is a fulfilment of one of the primary objectives of demonetization- promoting cashless economy. Post demonetization saw a boost in deposit, fresh account openings, and issuance of Rupay debit cards to PMJDY scheme accounts holders across the banking divide. Due to coming into terms with the cashless economy ideology of the government, many people have activated their savings culture which has led to reduced bank borrowings from the central bank (RBI). As a result of the cheap funds from deposit mobilization, banks have since increased their credit portfolios especially in non-food credit.
From the analysis, it emerged that GDP growth rate has been hampered by demonetization. CPI- Inflation was positively impacted as the rate has dropped post demonetization. The Exchange rate of Rupee to USD and the Japanese Yen has not been significantly affected but it has depreciated against the Pound and the Euro post demonization. Foreign Exchange Reserve which creates investor confidence in an economy was not impacted negatively post demonetization as it keeps on increasing year after year prior to and post demonetization. The stock market maintained its investor confidence and kept on appreciating whiles more taxpayers enrolled in to the tax net with about 10.1 million new entrants post demonetization. After demonetization more Indian citizens have signed up onto the digital platforms to conduct their daily banking transactions which is a fulfilment of one of the primary objectives of demonetization- promoting cashless economy. Post demonetization saw a boost in deposit, fresh account openings, and issuance of Rupay debit cards to PMJDY scheme accounts holders across the banking divide. Due to coming into terms with the cashless economy ideology of the government, many people have activated their savings culture which has led to reduced bank borrowings from the central bank (RBI). As a result of the cheap funds from deposit mobilization, banks have since increased their credit portfolios especially in non-food credit.
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This paper takes a look at some policies and programs initiated by the Indian government which aimed at fostering financial inclusiveness. According to the 2017 Global inclusive development Index, India's economy still ranks 60 th which... more
This paper takes a look at some policies and programs initiated by the Indian government which aimed at fostering financial inclusiveness. According to the 2017 Global inclusive development Index, India's economy still ranks 60 th which call for strengthening of the existing financial inclusion policies and rolling out more of such programs. Financial inclusion has become an evolving paradigm of economic growth that plays very significant role in poverty alleviation. To achieve an inclusive growth, the marginalized sections of the society must be brought into the mainstream by extending financial products and services to their doorstep. Since there is no specific financial inclusion indicator, several indicators are used concurrently in trying to measure the level of inclusiveness in countries across the globe. This paper therefore takes a look at some of the policies the Indian government has initiated towards the attainment of financial inclusion. The progress of these financial inclusion policies and the impact it has so far made since their implementation was reviewed. The progress and impact of policies such as Pradhan Matri Jan Dhan Yojana (PMJDY), digital India, financial literacy, and priority lending were examined. It was found out that due to these recent policies, many marginalized people who at the normal circumstances will not have access to financial services have been brought into the mainstream banking. The progress and the success of PMJDY and digital India for instance have been overwhelmingly encouraging.