Also in this letter:
■ Lido Learning sends final settlement offer to employees
■ PE, VC funds with five or fewer investors attract Sebi scrutiny
■ UIDAI to check fingerprint ‘liveliness’ to curb Aadhaar payment fraud
Top global tech firms raise concerns on recurring payments from October 1
Netflix, Microsoft, Spotify and Disney+Hotstar are among the companies that have raised questions on the feasibility of making recurring payments through mandatory tokens from October 1.
They are now – through an industry body – seeking the Reserve Bank of India’s (RBI) intervention to ensure hassle-free transactions once merchants are barred from storing subscriber card details.
Driving the news: The MPAI, an association that represents merchants, has requested the RBI to plug issues around recurring payments through tokens before giving effect to the no-card storage rule, three people familiar with the development told us.
“We humbly request that the RBI mandates card networks, payment aggregators and payment gateways to share a status report to demonstrate their readiness to fulfil tokenized transactions across all use cases,” the MPAI said in a letter to the RBI.
“We also request that the RBI takes appropriate actions as deemed necessary to ensure that issues with token flows for recurring payments are duly addressed, before requiring the ecosystem to action the no-card storage rule.”
Catch up quick: Tokenisation is a process by which card details are replaced by a unique code or token, allowing online purchases to go through without exposing sensitive card details.
RBI rules require all merchants to delete customer debit and credit card details before October 1 and replace card payments with unique tokens. Merchants are meeting on Monday, and will likely request a deferral of this deadline.
Merchants warn that implementing tokenisation without adequate preparedness will result in major disruption in recurring payments, akin to that seen in October last year when the mandate was first brought in.
Lido Learning sends final settlement offer to employees
Edtech firm Lido Learning has sent final settlement offers to its employees, multiple sources told us.
Details: According to the offer, employees will be paid 50-75% of their dues, which will be settled in two weeks.
About 75% of its employees have accepted the final settlement offer.
Teachers, educators, counsellors, and administrative staff have also received a similar offer, the people said.
What’s next? Once they sign the offer, the employees cannot take legal recourse, two workers who received the settlement offer told us.
However, teachers and other employees are not clear if their dues will be settled even after signing the document.
Parents and children have also expressed concern over the halting of classes and whether their fees will be refunded.
With no tutors left to teach, several parents have approached the police with complaints against the company over the past weeks.
Catch up quick: Lido Learning, which had earlier explored the option of a merger, initiated bankruptcy proceedings in the first week of September as the cash-strapped company struggled to pay teachers and its former employees.
Edtech troubles: Edtech startups have been facing the brunt of the current funding slowdown and bigger players including Vedantu and Unacademy have resorted to mass layoffs. Last week, Byju’s, India’s highest-valued startup, finally posted its audited results for FY21 after an 18-month delay.
PE, VC funds with five or fewer investors attract Sebi scrutiny
Private equity (PE) and venture capital (VC) funds holding money for five or fewer investors have drawn the attention of the capital market regulator.
Questions: Do such funds act as vehicles of family offices and promoters? Do managers of such funds come under the influence of a handful of wealthy investors? Is the regulatory interest a precursor to a broad-based rule requiring a larger number of investors?
While the intent of the regulator is unclear, the Securities & Exchange Board of India (Sebi) has in an email on September 12 — a week after it asked PE and VC funds about their valuation practices — sought various information on funds formed with a small club of investors, two senior industry persons told us.
What Sebi wants: These funds have to give details of investors in a scheme: name of the investors; whether it’s an individual, company, limited liability partnership, or trust; the country of the investor; the amount it has committed and the quantum of fund raised.
They also have to submit the name of the investee company, its country of origin, nature of business, and the instrument issued (equity, debt, convertible etc) to raise money.
The details have to be provided for every scheme of an alternative investment fund (AIF) — the regulatory term for PE, VC and angel funds. Besides, the name of a contact person in every fund along with the mobile number have to be shared with Sebi.
UIDAI to check fingerprint ‘liveliness’ to curb Aadhaar payment fraud
The Unique Identification Authority of India (UIDAI) has introduced a new security layer in the Aadhaar-enabled Payment System (AEPS).
Details: Called the “liveliness” of fingerprints, the feature is intended to prevent the use of fake fingerprints to fraudulently withdraw money through AePS, a senior government official told us.
AePS allows users to withdraw money from their bank accounts using the fingerprint details stored in the Aadhaar database.
“It is a sort of software upgrade. We upgraded all the active devices remotely and introduced changes which will check whether the fingerprint being used belongs to a person who is alive or not,” the official said.
This was introduced after reports of misuse emerged in the AEPS.
The government has nearly five million AePS point-of-sale (PoS) machines, called mini-ATMs. Of these, about 3.5 million are active monthly.
TCS struggles to get millennials back to offices
Tata Consultancy Services (TCS) is grappling with the continued unwillingness of the majority of its millennial employees to return to the workplace. The company is keen to end the work-from-home arrangement which was put in place in the wake of the outbreak of the pandemic in early 2020.
Driving the news: Fewer than 20% of TCS employees have returned to offices, according to people aware of the matter, although the company has sought to woo the workforce with nostalgic office pictures on its social media handles.
Millennials, who form 70% of the TCS workforce, had returned to their hometowns to save on travel and residential costs amid the pandemic. Now, they are questioning the logic of postponing the hybrid work plan to 2025 instead of implementing it immediately, said the people.
25/25 model: TCS had announced a new 25/25 model in 2021, to be implemented by 2025, in which only a quarter of the company’s half million employees would be required to work from the office at any given point and would spend only a quarter of their time in office. However, the company wants all its employees to return to the office before it transitions to the new model in a phased manner.
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