Tag: covid-19

Nudge Theory at work

Richard Thaler (Nobel Prize Laureate) and Cass Sunstein in their book “Nudge: Improving Decisions About Health, Wealth, and Happiness” define nudge as any aspect of the choice architecture that alters people’s behaviour in a predictable way without forbidding any options or significantly changing their economic incentives. Essentially a nudge is a change in an individual’s environment making it more likely that the person will make a particular choice or behave in a particular way. Further, to count as a mere […]

Shoe Leather Cost, Covid & Yes Bank!

People normally want to park most of their liquidity in an interest bearing savings account with a bank (or park in liquid funds) and minimise the actual cash they keep with themselves. This is because while the nominal value of cash remains constant, the real value of the same reduces with time due to inflation. However, some amount of cash one needs, to carry on day to day activities – to pay to vegetable vendor, for grocery store next door […]

Partial Credit Guarantee Scheme (PCGS 2.0) : Hits and Misses

Finance Minister, Nirmala Sitharaman last week, as part of Covid Relief Atmanirbhar package had announced Partial Credit Guarantee Scheme 2.0 (PCGS 2.0) for Micro Finance Institutions (MFIs) and Non- Banking Financial Companies. The stated objective of the scheme is “to address temporary liquidity/cashflow mismatches of otherwise solvent NBFCs/HFCs/MFIs without having to resort to distress sale of their assets for meeting their commitments, and to enable availability of additional liquidity to them for on lending”. ISF in an article published on […]

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