Every New Year brings changes in rules and it will help if you know them in advance. Here are a few of the new regulations which come into effect from January 1, 2024.
No penal interest on loans
Banks and financial institutions will not charge penal interest when debtors default on repayment of loans sanctioned from January 1, 2024. Instead, they will only impose a fine. This rule will be extended to all existing loans from June. However, the new rule will not apply to credit cards.
Until now, banks charged penal interest above the existing interest when people failed to repay loans, leading to a ballooning of the repayment amount. When the new rule comes into effect, borrowers will have to pay only a moderate amount as a fine, over which additional interest cannot be charged. Consequently, the repayment amount will not rise to astronomical levels.
Loan status
Another new rule regarding loans says that financial institutions have to mandatorily seek the permission of the customer to increase the EMI or extend the loan term whenever interest rates rise. Moreover, the borrower has to be given the option to choose either a higher EMI or a longer repayment period. Similarly, the borrower should be allowed to shift to a floating interest rate from a fixed rate at any period.
Vehicles to cost more
Citing an increase in raw materials and other reasons, several vehicle manufacturers have announced a hike in prices from January 1. The vehicle makers include Maruti Suzuki, Tata Motors, Mahindra, Honda, Hyundai, Nissan, Volkswagen, Skoda, MG Motors, Audi and Mercedes Benz.
Policy details
Insurance firms will simplify the customer information sheet (CIS), which mentions details such as the items covered, items which do not receive insurance coverage, waiting period and conditions to make claims.
Centralised reporting
A centralized reporting mechanism to inform the authorities about the demise of an investor in stocks will come into effect from January 1. The mechanism aims to make the transfer of shares to the nominee smoother. The death of an investor could be reported by the joint account holder, nominee or any family member. The death certificate and PAN of the account holder have to be submitted.
No paper form for SIM
The Department of Telecommunications will abolish the process of filling out paper forms to obtain a new SIM card. From the New Year, filling out a paper form and presenting photographs will not be necessary to get a SIM. Telecom firms should, instead, complete all procedures digitally.
UPI apps
The National Payments Corporation of India (NPCA) has issued an order to block transactions from UPI IDs and numbers that have not been used for one year. People who cannot send or receive money through UPI apps from January 1 for not using the app for one year would have to register again on the app.
Demat, mutual fund nominee updation
The Securities and Exchange Board of India (SEBI) has extended the deadline to add a nominee in demat accounts and mutual fund investments to June 30, 2024, from December 31, 2023. Accounts having no nominees will be frozen after June 30.