Slowdown effect? Salary increase in 2020 may be lowest in a decade at 9.1%

However, 39% of companies still plan to offer increases of 10% or more: Aon survey.

The economic slowdown is beginning to reflect in the salary hikes of India Inc. The average salary increase in 2020 is projected to be 9.1 per cent, the lowest in a decade, according to the 24th edition of Aon Plc’s annual salary increase survey. In 2018 and 2019, companies increased average salary by 9.5 per cent and 9.3 per cent, respectively. After the financial crisis of 2008, the average hike had slumped to 6.6 per cent.

The projected increase for 2020 is lower than the average salary hike that graduates of top Business schools have managed at around 12 per cent.

The good news, however, is that despite gross domestic product (GDP) growth estimates getting revised downward, the average salary increase for 2020 will be only 20 basis points lower than that of the previous year.

Moreover, double-digit salary increments have not vanished entirely. While the average for the country has come down, 39 per cent of the companies are still willing to give double-digit salary increases in 2020.

This year’s number is in keeping with the long-term trend. “The trend over the years has been downward. Up to 2011, the average salary increment was in high double digits. Between 2012 and 2016, it was at 10 per cent plus, and in recent years, it has come down to the 9 per cent plus mark,” said Tzeitel Fernandes, partner and head of rewards solutions, India, Aon. She added they witnessed a mood of caution among firms this year.

The survey by Aon, a global professional services firm, covered more than 1,000 companies, across more than 20 industries. The firms were split equally between manufacturing and service sectors.

The mood within India Inc, though a little jaded than last year, is not completely downbeat. One question posed in the survey was whether respondents saw their businesses improving, stabilising, or declining.

In 2020, 92 per cent of the firms still said they saw their businesses improving or stabilising (the figure was 97 per cent for 2019). “Despite the economy softening and certain amount of caution coming in, an overwhelming majority of firms still say they are likely to do as well, if not better, in 2020 compared to 2019,” said Fernandes.

Another trend that is evident is that the range in salary increases across sectors has narrowed. In 2020, e-commerce, early-stage, and professional-services organisations plan to offer an average 10 per cent increase, while the logistics/transportation sector intends to offer the lowest increase of 7.6 per cent.

Motor insurance: Six must-know ways to save yourself from fake policies

The insurance transaction process often includes reliance on third-party service providers, making insurance companies highly susceptible to fraud within and along its value chain.

The Motor Vehicles Act deems it mandatory for all car owners to have vehicle insurance. The number of road accidents are rampant, reinforcing the importance of a comprehensive motor insurance policy for all vehicles. This is applicable for all commercial vehicle owners who are required to purchase the motor insurance to protect, both, their drivers as well as third-parties from unprecedented accidents. This necessity has given rise to an increase in fraud insurance cases which in-turn is a concern for the insurance industry.

The insurance transaction process often includes reliance on third-party service providers, making insurance companies highly susceptible to fraud within and along its value chain.

Significant gap in awareness about the insurance coupled with the misrepresentation of it being a dead investment by customers makes them an easy prey for fraudsters. Now with the recent rule, where 2 wheeler owners have to purchase third party policy for a period of 5 years and private car owners have to purchase it for 3 years in addition to own damage policy, the premium slab for vehicle insurance has increased drastically for the consumer.

This has given rise to opportunities to fruadsters to sell fraud policies to unsuspecting customers, since these are offered at much lower premiums relative to the actual cost of a genuine policy.

Such fraud trends have been noticed across the country and several FIRs have been lodged in large numbers in cities across West Bengal, Maharashtra, Telengana, Karnataka, Tamil Nadu, Delhi, UP, Gujarat, Kerala to name a few.

6 essential ways to protect yourself from fake policies:

In India, since a third party motor insurance is made mandatory by law, it is still the most common form of general insurance that people buy. And since customers are not aware about the details of the policy offering and rather consider it to be a mere formality along with other documentation, they easily get tricked by fraudsters. These fraudsters edit genuine policy copies previously issued by insurance companies to generate totally fake policies in the names of the new customers. These same policies are then shared with both the customers and the RTO. Not only is this unlawful, but also puts the customer in a poor financial situation in case of an accidental exigency, even more so in case of third party life/property damage where the compensation amounts can run into crores.

Business Standard

Citi, Paytm tie up to issue credit cards, offer 1% cashback on transactions

Citi is already one of the largest credit card issuers in India with over 2.7 million cards in March 2019, while Paytm with interests in e-wallets and e-commerce has 300 million users.

Seeking to increase its penetration, American lender Citi has tied up with Paytm to launch a co-branded credit card with a slew of incentives.

Citi is already one of the largest credit card issuers in India with over 2.7 million cards in March 2019, while Paytm with interests in e-wallets and e-commerce has 300 million users.

"Within that population (of 300 million), even if we take one per cent of that population (for the card), that is 3 million customers.

We think there is tremendous potential for growth of this partnership," Citi's Chief Executive (Global Consumer Banking) Stephen Bird told reporters here.

Paytm Chairman and CEO Vijay Shekhar Sharma declined to spell out a formal target which the partners are aiming for with the new offering.

Both the partners have jointly developed a tool through which Paytm will be able to identify a potential base of customers who will be interested for a card and also meet credit requirements for the unsecured product.

"This is a partnership between two incredible companies" - @vijayshekhar

Introducing the 'Paytm First Credit Card' powered by @Citibank @VISA

Business Standard