Thinkpad: The Times They Are A-Changin
A clock on the shelf. (Photographer: Andrew Harrer/Bloomberg News)

Thinkpad: The Times They Are A-Changin

Happy Sunday.

Change is all around and so we have a second consecutive edition of Thinkpad focused on the new, the old and the friction between the two.

News this week came from the stock markets. The Securities and Exchange Board of India has allowed exchanges to offer a T+1 settlement cycle on a voluntary basis. This means that settlements can take place within one day of the actual transaction taking place.

The change will be good for some, better for others.

As Sajeet Manghat explains in this piece, the impact of a shortened settlement cycle will vary. Retail investors will benefit, as will trading turnover, potentially. For foreign investors, though, this will be equivalent to 'pre-funded' trades and may add to complexity. According to a Business Standard article, foreign investors have already lodged a protest.

A similar debate has taken place in the U.S., where discount brokerage Robinhood has lobbied for more real-time settlement cycles, only to be met with resistance from Wall Street.

In Bob Dylan's words: ♫The order is rapidly fadin'...And the first one now...Will later be last...For the times they are a-changin'

Times are also rapidly changing for the blue whale of Indian business — Life Insurance Corporation of India. 10 top tier investment banks have been picked as book running lead managers for the LIC IPO. Relaxations, rule changes continue to be considered to ensure the issue goes through smoothly. You can imagine the headlines and the red faces if it doesn't.

But, as Raghav Bahl asks, should we throw conventional wisdom out of the window and 'Do A Neeraj Chopra With LIC'? Open the window for a different kind of headline? Read here.

Meanwhile predictable resistance is emerging from employee unions. A profit-maximisation objective will dent the broader socio-economic role that LIC plays, argued one union leader in an interview with Bloomberg. Who's surprised? Anyone?

The theme of change, resistance and finding ways around it has also played out across a number of recent consumer finance initiatives. Here the battle is between safety and convenience. It is a theme worth exploring in greater detail but for now we give you a snippet.

Consumers want a single-click experience. God help us if they have to put their fingers to the trouble of a second click. And heavens will fall if they have to remember a card number or an expiry date. Excuse the sarcasm.

We refer here to a two-year long battle that the Reserve Bank of India waged to stop merchants from saving credit and debit card numbers of consumers. The Reserve Bank of India had legitimate concerns about data breaches but the online retail community feared that reduced convenience would mean loss of business. This week, finally, the regulator, after consultations with the industry, came up with a good middle-path — the expanded use of tokenisation. So, your online shopping experience should remain just as convenient, although it will change a bit, as Pallavi Nahata explains here. Online shoppers (i.e. all of us) read this one closely.

The times are changin'. So must we.

♫ Come gather 'round people...Wherever you roam...And admit that the waters...Around you have grown...And accept it that soon...You'll be drenched to the bone...If your time to you is worth savin'...And you better start swimmin'...Or you'll sink like a stone...For the times they are a-changin'♫

Till next week.

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