Banks flag hit to fee income from insurance payout curbs
In short
Several banks are assessing the impact of proposed rules on insurance-related payouts. Central Bank of India expects a 33% fall in bancassurance fees, and Canara Bank sees a ₹145-crore hit to fee income.
Axis Bank says it will try to make up the loss with more sales and other income. HDFC Bank has not yet worked out the impact, so the full effect is still unknown.
What the reporting says
Central Bank of India, Canara Bank, Axis Bank and HDFC Bank are weighing the impact of proposed insurance payout curbs, with one bank expecting a 33% drop in bancassurance fees and another seeing a ₹145-crore hit to fee income. Axis Bank says it will try to offset losses with more sales and other income, while HDFC Bank has not yet assessed the impact. The immediate consequence is uncertainty over bank fee revenue.
Why it matters
Banks including Central Bank of India and Canara Bank are expecting weaker fee income if proposed insurance payout rules are implemented. Central Bank of India sees a 33% fall in bancassurance fees, and Canara Bank expects a ₹145-crore hit. Axis Bank is trying to offset the pressure with sales and other income, while HDFC Bank has not yet assessed the effect. The source does not state the final rules.