What Does BUDGET 2020 Hold For The Common Man?

Each year, the union budget brings with it hopes and expectations of better aligning our source of income to our actual expenditure and taxes. People eagerly await fiscal recommendations by the government that will permit efficient planning of their taxes. Our honorable FM, Nirmala Sitharaman presented the Union Budget 2020 in the longest speech ever of 137 minutes, delivering a mixed bag of goodies for the individuals. The budget aims to push the demand side of the economy by attempting to put more money into the pockets of the individuals. 
The budget centers around three themes:

  • Aspiring India, 
  • Economic Development and 
  • Caring society

It also focuses on the ‘Ease of living’  concept. 
The 2020 Union Budget gave many new proposals intended to supply for the rising cost of living and reduce tax burdens on the individuals besides the budgetary allocations on several infrastructural and developmental projects that will boost employment in the economy and hence, the purchasing power of the individuals.  

A Simplified Tax Regime 

There are several tax-related benefits bringing reason to cheer for taxpayers in the budget this time. A new, simpler (but optional) tax regime is proposed where income slabs are at intervals of 2.5 lakhs each, as described below:

Source: Times Of India

  • Now, the 30% rate kicks in only for individuals earning 15 lakhs and above.
  • Earlier, those earning between 2.5-5 lakhs had to pay a 5% tax. But here’s the catch – the new tax regime won’t offer 70 tax exemptions out of the 100 exemptions that were earlier available in the old tax system.
  • Those who want to utilize the benefits of the tax exemptions and deductions like PF deductions, tuition fees, insurance, and others available under the previous system, can opt for the old tax system as well. 
  • The budget takes ample care to devote flexibility to the tax system while simplifying it. Now anyone can electronically file their tax returns without any special professional help.
  • A taxpayer charter is underway that will clearly define the rights of a taxpayer. 
  • PAN cards will be issued directly based on the Aadhar cards of the individuals. 

The lowered rates aim to increase the personal disposable income of lower and middle-income class groups whereas the foregoing of tax deductions and exceptions will indirectly help in creating demand in the market but might dissuade people from saving more thereby, creating a ripple effect of lowered investment in the coming times. 

More News For Salaried Professionals 

A further push to the start-ups is intended by the government introducing tax relief benefits on Employee Stock Ownership Plans (ESOPs). At present, there exists dual taxation on ESOP shares. The FM announced a proposal of deferring tax payments by five years or until employers leave the company, or when they sell their shares. 

Enhanced Insurance On Bank Deposits

To further lend credibility and trust to the Indian banking sector, the FM proposed the deposit insurance of banks be raised from 1 lakh to 5 lakhs. Thus, any bank account holder has now been assured a maximum sum of 5 lakhs in case a bank goes bankrupt. The LIC is to go public through an IPO as the government intends to disinvest a part of its stake in the insurance behemoth.  

Investing & Housing

  • DDT or Dividend Distribution Tax that was charged at 20.56% (from companies to mutual funds) and 11.56% (from equity funds to investors) earlier has been removed, and the classical system of taxation has been adopted by the government. Benefits here would be only for small investors falling in the lower tax brackets lower.
  • The tax holiday for affordable housing projects has been extended by another year to further boost the dream of owning one’s house indirectly. The affordable housing scheme project – Pradhan Mantri Awas Yojna is one of the major initiatives of the government. The tax holiday will ensure lower and affordable rates of housing. 

The 2020 Budget has evoked mixed responses from economists and common people. But executed right, the proposed ideas have the potential to usher in a new wave of lowered and simplified tax structures where more individuals become taxpayers. Automated systems and taxpayer charter should further enhance the trust of the individuals in paying taxes. As individuals, we could perhaps relax and plan our spending and savings in sync with the new tax routine and new bank deposit insurance. 

This World Cancer Day, How Close Are We To A Cure?

February 4th is observed as the World Cancer Day each year, with an aim to generate awareness among the masses about cancer, to educate them in its early detection and the promotion of a healthy lifestyle. We hear hundreds of survival stories revolving around cancer each year that almost overshadow millions of others losing the battle against this, fatal disease despite the correct diagnosis and treatment. Oncologists around the world have been researching vociferously and meticulously trying to come out with a cure of this disease that can affect our body in almost 100 ways. Medical journals boast of several new breakthroughs, treatments and therapies that are slowly paving a way to finding a cure to the disease.  But how close are we to finding one? 

9.6 million people die from cancer every year and 70% of cancer deaths occur in low-to-middle income countries.

Cancer can impact various body parts, act peculiar and show different symptoms with different risk levels attached to each type and stage of cancer. The umbrella term ‘cancer’ attaches with itself a phobia of a deadly disease very poorly understood by the common masses, yet 1 out of 6 deaths in the world is due to cancer as per WHO’s estimates. The disease affects millions of people worldwide, with India ranking third after China and the US. Every year, a million new cases are added to the doomed list in India. Half a million deaths occur due to diagnosis at a later stage or ignorance of the disease.  

Current Treatments For Cancer

Researchers, all across the globe, are still trying to understand the role of thousands of genes and the interactions of various other factors involved in the abnormal mutations of the body cells from healthy to cancerous. The disease, like a mutating monster, has to be understood before it can be prevented or mitigated. For now, there is no single comprehensive solution for every kind of cancer. 

So far, the available treatments include chemotherapy, radiotherapy, tumour surgery, and in the case of prostate cancer and breast cancer- hormonal therapy.

Some new kinds of cancer treatments are being used as well, in combination with the traditional ones or on their own having fewer side effects. Scientists are currently dealing with the challenges accompanied by these new treatments and trying to eliminate all the possible side effects. No single approach works for every kind of cancer. Still, scientists are hopeful with all the technological advances available in the wake of the cancer research going on at full speed. The question of finding a complete cure is a matter of debate but the progress is positive. 

The Cost Of Cancer Treatments 

The average cost of cancer treatment can range anywhere between 6 lakhs to 20 lakhs. Even if a person is insured against it, studies show that the expenditure in a home with a cancer patient can go up to 36-44% more than in other households. The finances are sure to be disrupted in case a family member is diagnosed with cancer due to stress, loss of a source of income or higher costs of treatments. The costs have risen due to more expensive infrastructure, patented drugs and the limited number of specialists available. 

India continues to have the highest levels of under-penetration in the world, with only 0.16% of the total population insured for health, as per Irda. Little wonder then that 70% of healthcare expenses are met from one’s pocket. Economic times

A majority of patients are unable to afford the costly treatments while at times, their bodies do not respond to the treatments suitably. A generic medical insurance plan does not cover cancer and specific insurance plans covering cancer would appear futile until one actually suffers from it. The borrowings and debts mount due to higher interest rates and no insurance claim available. The need is to act smart and go in for loans with lower rates of interest and those that are easily available. 

On World Cancer Day, EarlySalary wants to take the opportunity to reiterate our commitment to providing assistance to customers in case of any medical emergencies. We do this in the following ways:

  • Customers can borrow up to five times the amount of their regular salary
  • Customers are eligible even if they have no credit rating or are underserved – EarlySalary ensures availability of credit to pay their hospital bills in time. 
  • To cover the cost of cancer treatments and other related medical expenses, a salary advance of up to 2 lakhs can be directly transferred to bank accounts with minimum formalities involved. 

Hassle-free loans can be crucial in providing timely treatment and saving lives while reducing the financial stress in the lives of the family members.
This World Cancer Day, let’s pledge to promote the financial and physical well being of our loved ones and ourselves!


Compiled by: Akshay Mehrotra, Co-Founder & CEO EarlySalary

With the target to achieve USD 5 trillion economies by 2025, Honourable Finance Minister Nirmala Sitharaman has presented Union Budget 2020 for the 5th largest economy of the world. The core objective of Budget 2020 is to provide “Ease of Living” to all citizens with three broad themes viz. Aspirational India, Economic Development for all and Caring India for both humane and compassionate, together with Corruption free, policy-driven good governance on one side and clean and sound financial sector on the other side.

Budget 2020 is focused at Ease of Living, with good governance and clear and sound financial sector, it not only emphasized on traditional areas like welfare of farmers, Infrastructure, Education, Skills Development, Women and Child Welfare, etc. but also will emphasis on new areas such as Solar and Technology oriented businesses, Data Centre Creation, Quantum Technologies, creation of Knowledge Transfer Cluster, Agri Tech sector, etc.

Budget 2020 has given relief to an individual by way of reduction in income tax rates, Extension of time limits pertaining to the tax benefits for affordable housing, increase in deposit insurance coverage, etc. along with a reduction of 70 exemptions and deductions. Corporate will be benefited from the abolition of the Dividend Distribution Tax, the inclusion of the Power Sector under the concessional corporate rate along the new domestic companies in manufacturing. Budget 2020 given relief to MSME’s by increasing the Turnover threshold for audit. Businesses will be benefited by Simplified GST return which shall be implemented from 1st April 2020 and fully automated Refund processes. Also, Budget 2020 reduced tax on cooperatives and on sovereign wealth funds of foreign governments and other foreign investments.

The following are the key takeaway for Start-up and Financial Sector from Budget 2020.

  1. To address the liquidity constraints of the NBFCs, the Budget 2020 has reduced the limit for NBFCs to be eligible for debt recovery under the Securitization and Reconstruction of Financial Assets and Enforcement of Security Interest (SARFAESI) Act 2002 from INR 500 crore to asset size of INR 100 crore or loan size from existing INR 1 crore to INR 50 lakh.
  2. Increased limit and duration for eligible Start-ups with 100% tax benefits with turnover up to INR 100 crores (increased from 25 crores in current budget) of its the profits for three consecutive assessment years out of 10 years (increased from 7 years in current budget)
  3. To attract and retain better talent at Start-ups, Budget 2020 has proposed deferment of tax on ESOPs in the hands of employees by 5 years which will ease the burden of taxation on the employees.
  4. MSME focus and Bill discounting model will greatly boost lending models further.
  5. The new tax regime will reduce the tax burden on individuals and ensures more deposable income which will booster for the entire economy including Start-ups.

We expect Budget 2020 will act as a catalyst to the economic development of the country and to increase overall GDP growth to achieve a target of USD 5 trillion economies by 2025.

Desire a steep price tag item? How to smartly tackle your shopping wish list.

With seasonal sales always on the horizon and e-commerce giants often announcing festive season best-ever sales on their websites, ‘Not Shopping’ is hardly an option for the consumer (or even the utilitarian). The internet is constantly flooded with coverage of online sales on Flipkart, Amazon, Myntra, and many more. Anything and everything you need to make the year worth may be put on sale. 

As we surf through websites and apps to grab the best deal, we not only buy products that we need but also products on which we don’t want to miss offers and deep discounts. Whether you are browsing with a list or without a list, it’s hard to ignore shopping and sales. Gadgets and electronic appliances come with a steep price tag and hence, even when you have sufficient funds, splurging it all to get just one product may make your monthly finances suffer. A shopping loan can come to the rescue in such situations. With quick online loan approval and disbursal and flexible repayment options, personal loans can fulfill your shopping list without burdening your monthly expenses. 

Whatever be the reason behind shopping, it requires funds, of course. If you haven’t parked a good amount for it then you may find yourself in a situation of money crunch. Impulsive shopping can hurt your monthly budget. However, situations like these can be avoided by taking a personal loan. 

Personal loan apps such as EarlySalary feature an entirely online loan application process, including document submission. You only need to arrange for your KYC documents like PAN, Aadhar and address proof. Naturally, the time for approval and disbursement is significantly reduced on these instant personal loans. If you are eligible as per the defined criteria, your loan will be approved within hours.

No documentation is needed to indicate a specific purpose for availing the loan or where you are going to use it. It can be used for anything as per your requirements. 

An instant cash loan is one of the best ways to grab an ongoing sale, as they are quick in disbursal. These loans do not help you finance your shopping urges, but also help you plan finances in a better way through flexible repayment options. Another advantage of personal loans is that they are collateral-free, you do not have to put any of your valuables in a lien. 

Should You Take A Personal Loan For Shopping?

Well, the answer depends on the context. A shopping loan’s justifications depend on the products that you buy. Availing loans for shopping during sales for utility items such as furniture for the home, kitchen appliances or a computer can save enough money in terms of opportunity cost. Loans for impulsive shopping disorders are, of course, not recommended. The deals may tempt you, but resisting those temptations is important to avoid getting into a debt trap, similar to how we must treat credit cards

Whether it’s a festival or a sale, a purchase decision should ideally be taken if it is a need or if the opportunity cost of delaying the decision is higher.  Make the right choices and spread big-ticket shopping expenses across several months with personal loans in the form of small and affordable EMIs.

Applying For A Credit Card? Don’t Make These 5 Mistakes

Applying for a credit card is a fairly easy process, but many applicants tend to make some common mistakes while they’re at it. These mistakes have consequences – ranging from a flat-out denial of your application to potentially costly penalties in the future. Goes without saying, such mistakes are detrimental in getting the application itself approved, as well as the applicant’s finances.

While you should certainly be warned on getting too friendly with credit cards, the process of applying for a credit card has its own share of common mistakes applicants might make. Let’s take a look at what they are and why you should avoid them.

1. Too many applications over a short period
Applicants often lean towards playing the numbers game when they apply for credit cards. Statistically, you’d think submitting multiple applications would increase the probability of getting approved. But credit cards are a different ball game. Simply applying for as many cards as you can doesn’t mean you have a higher chance of getting approval. In fact, it could prove to be quite the opposite. 

When you apply for a credit card, it may affect your credit score. This is because the issuer will conduct a thorough inquiry over your credit history. Applying for multiple cards makes you look like a reckless borrower. It is recommended to wait six months between credit card applications to avoid hurting your credit score.

2. Not doing due research
There are a plethora of credit card providers in the market, which puts applicants in a useful position as they can opt for one that suits them well. However, many fail to shop around and end up landing on a credit card that may not be best suited to their financial needs. It is vital that you apply for cards that actually meet your spending habits and needs. 

You have to know how you will be using the credit card – what will you be paying for? Do you foresee any big purchases using your credit card, or considerable expenditure each month? If so, you will require a card with a high credit limit. You have to know your financial needs to pick the right credit card. But the good news is that there are a lot of options and it is fairly easy to find the right one for your requirements. 

3. Not understanding the terms and conditions
This might seem a silly thing to overlook, but is, in fact, one that is quite common. Do not choose a credit card based on the company’s reputation or initial offerings alone. Dive deeper into the provisions, terms and conditions, repayment plans and other costs associated with the credit card you are considering. This will give you valuable information like interest rates, annual fees, and reward structures. 

If you travel a lot, you will be better off with credit cards that offer travel insurance and no fees for international transactions. If you eat out often you can check out cards that offer high returns and rewards for dining expenditures. Choose a credit card once you know exactly what features and advantages it offers.

4. Applying before paying the bills

Do not apply for a credit card before you pay off existing bills. While considering your application, the banks will go through your credit report to look at your debt to credit ratio. This ratio has a heavy impact on your credit score; meaning the more debt you have, the lower your score. For a favorable evaluation of your credit card application, it is recommended that you pay off your existing debt before you apply for a credit card. Even if you are unable to pay off all your debt, pay as much as you can before you apply for another card. Always remember: Your credit score is the major deciding factor on whether your application is approved or not.

5. Applying for a credit card for access to inexpensive credit
If your primary objective behind obtaining a credit card is to simply get access to short term funds or loans, you’re shopping at the wrong place. Credit card interest rates can be prohibitively expensive – often as high as 42% per annum. They are therefore more suited for quick access to credit for the very short term, during which you arrange for funds to pay the monthly bill. If you intend to get a loan for any longer amounts of time, it makes more sense to apply at instant loan apps like EarlySalary. With credit availability of up to Rs 2 lakhs at rates as low as Rs 9/day, services like these are by far the more convenient and inexpensive option for borrowers. You also get flexibility in repayments – being able to choose between 3 or 6 EMIs at nominal rates. EarlySalary’s partnerships with leading brands such as Amazon, MakeMyTrip or Big Bazaar allow borrowers to access credit directly while shopping or traveling. Online loan apps are a new-age financial innovation that are taking the country by storm!

Remember – applying for, or acquiring the wrong credit card, can prove detrimental to your finances over the long term. Take your time and do your research before you apply for a card, and you stand to benefit in multiple ways – such as better credit scores, increased spending ability, and reward points and other benefits.

Common Income Tax Myths busted

As tax season approaches, a sense of urgency sets in among all taxpayers alike. With a maze of laws and by-laws governing Income Tax in India, it becomes quite challenging to accurately comprehend the procedures and nuances involved in filing tax forms and income declarations. It is because of this confusion that people end up believing in false or half-baked information, which propagates several myths in the minds of the masses. 

Even though the process of Income Tax has been simplified in the recent past, with the increasing popularity of digitalisation and ease of starting and maintaining businesses, it is important that a few of these popular myths are debunked in order to make things easily understandable for all people alike. Some of the popular ones:

#1 E-filing is not a safe option

In fact, in a time where digital penetration peaks at all-time high, banking and financial transactions online have become increasingly safe and secure. Robust cryptographic encryption and increasingly secure transmission channels with security measures like OTPs and 2-factor verification have contributed to this. Additionally, there are several other benefits of filing tax returns online, like speedier processing, and greater accuracy. In short – e-filing is entirely safe, and in fact, a superior option.

#2 Filing of Income Tax is only in the case there is some profit being earned 

Contrary to popular belief, even if a company, LLP or partnership is not generating any profit, that is to say there is no income but rather a loss, the law mandates that IT returns must still be filed. 

In fact, in cases of an entity duly filing loss in their IT returns, the future tax liability of such an entity can be further diminished in subsequent financial years.  

#3 Return of Income Tax has to be filed only in the case if some tax liability is due 

In many instances, the tax liability of a person may be fulfilled via indirect means of collection such as TDS, TCS and other such deductions. Or this liability is discharged prematurely by way of advance Tax. In such cases, most people believe that they do not have to file IT returns. However, that is not the case. Even in cases where a person might not have any tax liabilities due, IT returns have to be filed to serve as a record for both the government and the individual on taxes paid. 

#4 In case I lose my PAN card, I can’t file my IT 

If a PAN card has already been duly issued to the tax filing entity, having physical possession of the card is not at all mandatory. In case of paper-based filing of IT returns, the online copy of the PAN card or simply the PAN card number can be produced. If the assessee is using the E-filing method, there is no need of a physical PAN card at any stage at all.  

#5 If filings are missed, They Can Simply By Filed Later Without Penalties

Income tax is not a voluntary payment but a permanent liability imposed by the government of the country on each and every person, natural or artificial. Not only is it a compulsory payment but in case of arrears in paying this tax, heavy penalties can also be imposed on defaulters as per the provisions of the Income Tax Act of 1961. 

#6 Tax can only be filled by a professional Chartered Accountant / Tax lawyer 

Ever since 2013, the process of filing of Income Tax has been fairly simplified and the number of forms required to file IT returns has been reduced from 5 to 1. You can file an income tax return on your own or take the help of a professional, but the choice remains entirely yours. There is no mandate in law making it compulsory for a CA/Lawyer to file an IT return on your behalf.

#7 Gifts and windfall gains are exempted from taxation net 

In fact, any gift received by the assessee in the form of cash, gold jewellery, etc. beyond the monetary value of Rs. 50,000 falls within the tax limit and is taxable.  As for the tax liability of windfall gains such as lotteries, or crossword puzzles, among others, TDS has to be cut at the flat rate of 30% in case the prize value exceeds Rs. 10,000. 

With these common myths out of the way, filing IT returns is much less of a difficult task than it might appear to be at first. In fact, among other important aspects that you may want to know, one is that even personal loans can be tax deductible in India.

It is important to remember that regular payment of taxes on time is necessary not only to ensure that no penalties are imposed on the payee, but also to contribute constructively towards the development and progress of the country. If you’re bracing yourself for tax season, check out this handy guide on tax filing.

How Financial Programs Drive Long Term Change

By: Sandeep Raghunath
About the Author: Sandeep Raghunath is the Head of Human Resources at EarlySalary, with 10+ years of international experience in HR across industries

Financial programs aimed at employees may be associated with several different perspectives both for the employees and for the business owners. In most cases, these employee benefit programs play a major role in attracting prospective employees and improving team morale. They can prove to be both a liability or advantageous to companies depending on how well they are handled and deployed.

That being said, there are fairly apparent advantages and drawbacks for a company to indulge in such programs, and the evaluation of the potential risks is certainly critical. In this post, we shall focus on the positive aspects of financial or employee wellness programs from a business point of view. 

Financial wellness programs help in recruitment and employee retention

Prospective employees look for benefits such as health insurance, paid leaves, and bonus plans. These benefits not only draw more talent, but also help in retention. Employees working with companies with such plans are significantly less likely to quit their job, since they’re focused more on their work than their wallet. Since this leads to a larger and more productive team with only the best employees, it helps create a collaborative community where output is delivered faster and with high efficiency. 

Cost reduction and increased profits

Deploying strategies that use financial benefit programs for employees might seem expensive at first, but with a closer look, it can be clear how these programs might actually benefit the company financially. A financial benefit program creates an atmosphere of productivity in the workplace by enhancing the quality and efficiency of work indirectly. This might seem unusual at first glance, but it is observed that employees largely do not abuse the benefits given to them – like paid leaves or bonus plans. This assists the company remain in sync with its revenue projections, and possibly even help retain clients for longer periods. Costs incurred in severance, employee training, and rigorous business development are therefore lowered.

Advantages of healthcare benefits

Healthcare benefits as a part of financial wellness programs enjoy the highest demand among employees in any given sector right now. Thanks to the growing costs of healthcare worldwide, employees are actively looking for positions or jobs that offer health insurance packages. Companies that do so attract the most applicants and also maintain a great retainment number. This usually means that there is a positive culture created by healthy employees who are routinely tested medically to ensure top-notch productivity rates. While this can directly pump up the productivity rates of a business, it also increases business value as more employees with experience with the same company continue to work.

Benefits of this league can trigger small but highly impactful changes in the overall working of an organisation, which is, of course, crucial for optimal performance. Setting a positive culture, creating a collaborative community, increasing profits and improving sales pipelines are just a few of the changes that are noticeable due to financial wellness programs and there are numerous other small effects that drive radical changes in a business.

Employee Loyalty: Earned, Not Taken

No one would disagree that, even in this tech-fueled age, employees play a critical role in the growth of an organisation. The importance of employee loyalty in the workplace shouldn’t be taken lightly, as it can provide a lot of value to an organisation through devoted hard-working professionals. However, due to the lack of awareness or other reasons, HRDs, in spite of the sector, are facing numerous challenges in maintaining loyalty among employees. The primary cause of these challenges is often employers sidelining the fact that employee loyalty is earned, not taken.

Why is Employee Loyalty Important?

Today, one of the biggest challenges that employers face is recruiting talented individuals. Once they succeed, it becomes an even greater challenge to retain these employees in our highly competitive business culture. Although hefty job compensation and lucrative perks can help in attracting potential employees, it may not be enough to retain them in the long term, if they feel unappreciated by their employers. The likely solution to tackle the employee turnover issue is to develop a strong bond and earn their loyalty.

Loyalty is a characteristic that comes from within. It cannot be forced or demanded. Therefore when a person is loyal to something, they give their best performance to the cause. Similarly, employees’ loyalty to an organisation can encourage them to work harder to perform their tasks with high quality. This will not only push the success rate of any organisation to new heights, but also contribute to retaining talent. Furthermore, loyal employees are more engaging, try to contribute through different ways towards the company’s better future.

How Can Employee Loyalty Be Earned?

The relationship between an employer and an employee is woven with threads of mutual gains. Many employers often interpret the nature of this relationship as the cause guaranteed loyalty from employees just because they also have something through this contract. 

Today, workplaces have changed dramatically due to the evolution of technology, economics, work ethics and social values. In this dynamic workplace environment, besides compensation, employees also seek acknowledgement and respect from their employers.

While earning employee loyalty is certainly challenging, it is almost certainly possible. Here are some ways to ensure employee loyalty in any workplace.

Build Lasting Trust

The first step in developing employee loyalty is to earn their trust. Employers need to foster a workplace environment where employees feel valued and appreciated for the work they do. Employers must indicate that they are also invested in the progress of their employees. Furthermore, employers should be transparent when dealing with employees’ expectations while also ensuring that organisational interests are not compromised. 

Recognition is Important

No organisation can aspire for success without a hard-working team. It is important to give adequate and timely recognition to employees who outperform. When employees are acknowledged by the company management for their efforts, they also develop a sense of loyalty towards their teams. 

Promote Equality

While employee recognition is important, recognising everyone equally holds even more significance. Bias often leads to several issues, no matter where it occurs. When employees go unacknowledged in their organisation, their loyalty is likely to suffer a dent. As a potential consequence, the organisation may face higher attrition.

Take Them Aboard

People respond positively when their ideas or opinions are acknowledged, the same also goes for employees. Employers should demonstrate to their employees that they are important and their opinions also matter. This can be achieved by taking employee feedback and then ensuring a follow-up. If employees find themselves as a valuable part of the company’s future, they are likely to remain loyal and continue working. 


There’s no doubt that a loyal workforce can help most organisations solve major challenges with greater efficiencies. It ultimately comes down to employers to figure out how they can generate trust. Sure, it isn’t something that can be achieved overnight. This is a continuous process after all. One that requires employers to analyse, build a vision, and act very carefully. One aspect that shouldn’t be forgotten is even the smallest gesture of kindness can go a long way, and have lasting impact on employees. These are exciting times for HR professionals to go about executing their vision and leave lasting legacies!

Biggest HR Challenges to Expect in 2020 and How to Solve them

In the HR domain, I’ve seen firsthand the impact of evolving technologies in the function. The rise of AI is rendering several jobs obsolete while simultaneously creating new job requirements. Employers increasingly need to look for highly skilled workers, and the employment market often seems like it is falling short. Demand, in this case, is higher than supply, causing several challenges to the HR sector. While there are plenty of challenges recruiters can expect in the coming year, I’d keep my eye out on the following:

  • Personalised experiences like employee well-being

One of the newest trends among job-seekers is a focus on wellbeing and workplace culture. This presents a major challenge for enterprises as a whole and HR professionals in particular. It used to be easier to attract and retain good candidates – a solid pay, job security and some additional benefits often formed a complete, satisfactory package. Since this outlook is changing, the HR function’s focus is also shifting from these traditional factors to those which are more challenging to address, like work-life balance and open culture.

A solution to this is to treat employees as separate individuals rather than as a group and personalise their experiences as much as possible. Employees have different needs from their jobs, and to retain a skilled workforce, HR teams could try to be as accommodating as possible while sticking to company policies and ensuring the most judicious use of funds. 

  • Finding and landing high-quality workers

According to XPert HR’s fourth annual survey, nearly 30% of the respondents felt that recruiting and hiring would be their biggest challenge in 2020. It’s difficult to keep up with the rapid changes taking place in the industry, and appropriately skilled applicants are hard to come by. Not only must the candidates have adequate skills, but they must also be adaptable and open to changing their methods with the fast-changing trends in the industry. While unemployment runs rampant, such talent is limited.  Talented individuals available for hire are in high demand, and the HR function’’s major challenge is to attract them towards their company. 

One solution, although also complex and perhaps subjective, is fostering a culture and an environment where people are engaged and committed to their roles. It involves several considerations, such as benefits, incentives and a focus on employee well-being. The biggest consideration here is addressing the needs of different generations of workers and providing personalised benefits to each group rather than a one-size-fits-all policy. Other solutions may include tapping into job markets like older employees, veterans as well as those with criminal convictions.

  • Diversity and inclusion

The diversity question today goes beyond gender, race, ethnicity, religion and age. Rather, it includes differing work experiences, sexual orientation, socioeconomic status, upbringing, educational status and even physical characteristics. Managing a diverse workforce while trying to ensure inclusion for all is a great challenge for recruiters. 

Some ways to ensure diversity and inclusion are to keep a fair and balanced recruitment process and to eliminate bias. Biases among recruiters are often subconscious and cannot be easily changed. For example, several surveys show that applicants with “white-sounding names” are 50% more likely to be invited for an interview than others. Such biases can be reduced by leveraging AI – harnessing technology to ensure inclusion is one of the best ways to overcome this challenge.

  • Outdated technology and data security

Although it is 2020 and a variety of advanced recruiting tools are available, several organisations still persist in using tedious technologies to organise their search for new hires. While Excel and email still have their advantages, using newer technologies can prove much more efficient and leave HR managers with time to work on more pressing challenges. Another important challenge which stems from advancing tech is the possibility of breach of privacy of the candidates. Applicants provide a lot of personal information, trusting the recruiters to protect their sensitive information from hackers. Data security is hence a major concern.

An ideal, and perhaps the only way to solve these problems is through improved technologies. Getting rid of outdated technologies for hiring as well as being extra careful about data privacy and security are a good approach to tackling these challenges. 

  • Bad hires

In a hurry to source and hire employees for roles, recruiters are prone to making errors while hiring. While the risk of making bad hires was always non-zero, it is now more prominent than ever, since sourcing candidates with the right skill set is a challenge in itself. Requisite skills and work experience are, of course, not the only aspects that make for suitable candidates. They must also align with the company’s ideals and, in general, be a good fit for the enterprise as a whole. A willingness to learn and adapt to changes and a drive to work hard are also desired in any candidate. Without these essential qualities, no amount of skill would guarantee a good fit. 

The only solution to such a problem is to be more careful while recruiting candidates. It is also essential that the recruiters know exactly the kind of talent they seek, over and above the necessary skill set.

While there are several challenges to the HR sector, the most important one stems from the increasing demand for a highly skilled workforce and the scarce supply. While the above points cover most major challenges and ways to overcome them, some further solutions include:

  1. Adopting more efficient talent sourcing techniques 
  2. Being proactive in building talent pools
  3. Increasing focus on passive candidates through promotions on social media, and
  4. Improving candidate experience throughout the hiring process by actively communicating with them.

Our Republic Turns 71: Has Our Credit Sector Kept Pace?

They say the concept of credit is as old as humanity itself; coming into existence even before the concept of money did. The concept of formal credit, however, is a little more recent. On the occasion of the Indian Republic turning 71, we trace the history of the Indian credit sector, and see how it has evolved into what it is today.

Early India

According to several early texts, money lending has been around in India since the Vedic period. However, the first texts to mention a systematic lending system were Kautilya’s texts of the Mauryan age. The scriptures mention loan deeds prevalent during the period. Later, during the same period, an instrument called adesha is mentioned, which was quite close in its application to the modern bill of exchange. During this period, merchants are also recorded as giving letters of credit to each other. In addition to these instruments, there is evidence of the use of barattes, which were payment orders by the royal treasuries, and Hundis, which had varied functions in different situations.


While there is evidence of systematic credit systems during the various periods in early Indian history, things changed completely when the British came into the picture. The formal banking system came with the colonisers. The first bank that came up under the British rule was the Union Bank of Calcutta, and several banks including Allahabad Bank and Punjab National Bank. 

During the 20th century, the Indians started opening their own small banks to serve particular communities. Several banks were formed between 1906 and 1911 as part of the Swadeshi movement, including Bank of India, South Indian Bank, Bank of Baroda, etc. The Swadeshi movement also inspired the establishment of private banks in Dakshina Kannada and the Udupi district. All this served well to formalise the credit sector in India. But the major event that cemented our banking systems was the establishment of the RBI in 1935 to regulate lending throughout the nation. 


The banking system before independence had been, for the most part, privately owned. When India finally gained her independence in 1947, however, the partition affected the economy adversely, especially that of Punjab and West Bengal. The newly formed government quickly sought to strengthen the economy by actively involving itself in the country’s economic affairs. One of the biggest steps towards the same was the establishment of the Banking Regulation Act, 1949, which empowered the RBI to regulate and control the Indian banks. Before the Act, RBI had few powers over our banking system. Most banks at that time were nationalized and highly rule-oriented. For a while after independence, the Indian public had quite a difficult time getting loans for any purpose.

Modern Lending Systems

The 1990s saw a paradigm shift in economic matters throughout the world. Globalisation and liberalisation caused India, too, to relax some of its rules. As our nation opened itself to the global economy, new private banks such as HDFC, ICICI and IndusInd were established. Lending and borrowing became faster and more efficient than before. However, getting a loan sanctioned was still a tedious task at that time. It would involve several trips to the bank, rushing around for copies of documents and hefty collaterals against the loans. 

The sector is currently undergoing another paradigm shift, one as significant as that which was caused by the globalisation movement. The use and high prevalence of new technology is gradually making the process of lending and borrowing much simpler than it was before. Cryptocurrencies, blockchain and artificial intelligence are technologies which have contributed to this shift, but much more popular than all these sophisticated technologies, is the attractive prospect of getting a loan while sitting at home through instant loan apps. The advent of such services has been well timed, while the nation is seeing rapid growth in credit like consumer durable loans, which grew the fastest as recently as 2018.

The need for credit from the average Indian is visible across different metrics. Take credit cards. While debit card transactions doubled between FY 13-18, credit card transactions leaped ahead by a whopping 5 times. Apps like EarlySalary are gaining immensely in now, precisely because they have made it simpler than ever before to borrow. 

Where several trips to the bank were once necessary in order to secure even a small loan, instant loan apps have made it possible to get personal loans with quick approval, effortlessly from the comfort of home. EarlySalary, which is one such app, offers personal loans of up to ₹ 2 lakhs made available instantly. Other loans offered include travel loans, shopping loans and education loans of up to ₹ 5 lakhs. 

While there are many players in the instant loan sector, EarlySalary alone crossed the million customers mark recently. Clearly, the credit sector in India has evolved from a fairly informal system based on trust and few documents in Early India, to a rigid system with several rules governing it post-independence, to the quicker, more efficient digital system of modern times.