2024 New: Top 5 finance changes that come into effect from today, January 1

Major changes to implement from January 1, 2024 (Photo: Canva/Representative Image)

Significant changes are anticipated in the finance world. Small savings schemes will feature increased interest rates, insurance policy documents will become more understandable, dormant UPI IDs are set to be deactivated, cars will experience price hikes, and the traditional physical verification for SIM cards will be gradually eliminated, among other developments.

Here are some of the notable changes set to take place from January 1:

1. Increased interest rates on small savings schemes: The Sukanya Samridhi Account Scheme (SSAS) will experience a 20 basis point rise to 8.20 percent for the March quarter. Similarly, the 3-year time deposit interest rate will see a 10 basis point increase to 7.10 percent starting Jan 1, 2024.

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2. Elevated car prices: Several auto companies like Tata Motors, Audi, Maruti, and Mercedes Benz have announced an imminent price hike in January due to escalated input costs. Expect a speculated increase of 2-3 percent, potentially higher for specific models.

3. Inactive UPI IDs to be disabled: UPI accounts on popular apps like Google Pay, Phone Pe, or Paytm that remain unused for a year will be deactivated from Jan 1. This measure, following a circular by the NPCI on Nov 7, 2023, aims to prevent fraud by disabling UPI IDs, associated numbers, and phone numbers without transactions for a year. However, users can re-register their apps for transactions and payments.

4. Simplified health insurance policy documents: IRDAI has instructed insurers to release revised and simpler Customer Information Sheets (CIS) for health insurance policyholders starting Jan 1, 2024. This initiative seeks to ensure policyholders comprehend policy features better without complex legal terminology.

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5. Digital-only verification for SIM cards: The Department of Telecommunications (DoT) has mandated telecommunication companies to eliminate physical verification when selling SIM cards, transitioning to a completely digital Know Your Customer (KYC) process starting Jan 1, 2024. Customers will only need to present their photo identity proof for digital verification. This move aims to reduce telcos’ acquisition costs and prevent SIM card fraud.

The DoT stated, “The use of paper-based KYC process shall be discontinued from 1.1.2024,” reflecting the ongoing amendments and changes in the KYC framework.