In a series of financial updates, several changes are set to impact individuals and entities as the new year unfolds. Here is a breakdown of the significant modifications:
Inactive UPI accounts deactivation
The National Payments Corporation of India (NPCI) has directed payment apps and banks to deactivate UPI IDs and numbers inactive for more than one year.
Compliance was mandated by December 31, 2023. Furthermore, the NPCI is set to introduce the ‘UPI Tap and Pay’ feature across digital payment providers by January 31, 2024.
Higher interest rates on small savings schemes
A notable increase of 20 basis points has been implemented in the interest rates for both the Sukanya Samriddhi Account Scheme (SSAS) and the three-year time deposit.
The Sukanya Samridhi Account Scheme (SSAS) interest rate for the March quarter has surged by 20 basis points to reach 8.20 percent.
Additionally, the interest rate on a 3-year time deposit has experienced a 10 basis points uptick, settling at 7.10 percent for the quarter starting January 1, 2024.
Bank locker agreements
Individuals with bank lockers were required to sign the revised bank locker agreement by December 31. Failure to do so resulted in the freezing of lockers starting from the very next day.
Paperless KYC for SIM card
Commencing January 1, 2024, the traditional paper-based Know Your Customer (KYC) process for SIM cards will be replaced with a paperless KYC.
The Department of Telecommunications (DoT) has urged telecom providers to gradually shift away from physical client verification for SIM card issuance. Clients will only need to provide a photo ID for the entirely digital verification process.
Income tax returns deadline
December 31 marked the deadline for both belated and revised Income Tax Returns (ITRs). While regular ITRs had a deadline of July 31, those filing belated returns incur a maximum penalty of Rs 5000, with no cost for those submitting revised returns.
Simplified documents for insurance
The Insurance Regulatory and Development Authority of India (Irdai) has instructed insurers to release revised customer information sheets (CIS) for health insurance policyholders from January 1, 2024. The aim is to ensure that clients understand the main points of their policies in a simplified manner.
