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The Ides Of MarchToday (3/15/2012) President and CEO of eBay John Donahoe ironically announced at Ghirardelli Square in San Francisco, a new Retail Payment Solution "PayPal Here". This day is full of irony in that the announcement is primarily directed at Square (company) and it also was not such a good day for Julius Caesar in 44 BCE. John Donahoe minced no words on his intent “This product is better. This product is backed by PayPal. It's backed by 100 million customers and one of trusted by payments brands around the world”. We all knew this moment would arrive.Warning, this will be a bit of a long post as it is important to gain relativity on this subject.The PayPal Winged Card Reader called "Here" (aka the Blue Dorito) designed by Yves Béhar.A Titan AwakesPayment Card acceptance for small and medium sized retail businesses have experienced a tidal force of change over the last 24 months. This multi-billion dollar Titan is waking up and taking its first firm steps into the confluence which will imprint both consumers and merchants with a number of new and unique options. For anyone in the payments industry to ignore or downplay the potential impact this may have would be foolhardy at best.Here I got some Blue Doritos for you. Humor about a serious change in the marketplace.A multi-country AnnouncementPayPal has entered into this market in the US, Canada, Australia and Hong-Kong. This will extend the potential market reach to nearly double the size of it’s nearest competitor. This alone will grant PayPal a much larger base for potential success. PayPal has most EU countries and China on target for the end of the year.Reality Check: Is Your Wallet Broken? Is Your Store's Payment System Broken?To be clear, nothing announced today by PayPal is world changing by any stretch of the imagination. For at least the next dozen years you will still be carrying payment cards with you, they will have EMV ability because the banks that issue these cards have committed to this, and it is their system we use when we pay with a Payment Card. No matter how sexy a new system is there is simply no mathematical way to change the momentum of something that is not seen as broken to most people. I am sure that today most of us will use the existing payment system just like our mom and pop did and it will work remarkably flawlessly. Perhaps there is not much to fix? Sometimes the blind drive for “disruption” clouds reality.If The Media Was Correct, You And I Would Be Paying With Our Fingers TodayThere will be endless debates from bloggers and media observers covering all aspects of this announcement. Most will miss some very important points. We certainly all love to fantasize about a future world where we do not need to carry a Payment Card or a wallet for that matter. I have seen some of the most brilliant minds lead billions of dollars down this money pit. I will be the first to admit that I love new ideas and technology. However I must add just a bit more sobriety with a study of the history of a company called Pay By Touch (http://en.wikipedia.org/wiki/Pay_By_Touch) with a billion dollar funding, over 800 employees and some of the best tech talent and management to be found in the Silicon Valley and it was a colossal failure. Many new and perhaps old observers have little to no knowledge of how and why a simple, use your finger to pay wallet system failed.I could fill a large book with the true reasons why but for this post it is just important to know some things were actually tried before by darlings of the media and failed. Just about all observers "knew" after very high profile political leaders invested in Pay By Touch, that within 5 years the Payment Card and your wallet would be replaced by your finger, the logic seemed so flawless, so simple: most of us do not leave home without our fingers, it just works. They predicted the card to be dead and the wallet to be dead. They will likely make similar predictions on either side of this new announcement.PayPal And The Walled GardenPayPal’s journey has been a successful one on the Internet. However many, including experts in payments, fail to see that PayPal’s success was directly connected to the rise of eBay and the walled garden they built around payments. We would not be talking about PayPal today if eBay did not purchase the company at a very critical point in PayPal’s history.The retail payments space is also a walled garden, however it is controlled primarily by Visa and MasterCard. PayPal’s rise took place in a period when Visa and MasterCard did not have the will or ambition to see how important Internet transactions would become. For PayPal, this new market will not have the ready made customers that eBay provided. Of course they do have a substantial number of relationships with millions of merchants but there will need to be substantial motivating reasons to adopt any change in the current, unbroken system.What Are The Details Of PayPal's New Retail Payment System?There are a rather large number of interesting points that surround this new product launch. This is more than just taking the Internet version of PayPal and bolting it on to a retail use case with a unique Card Reader. There are two fundamental categories that encompass the new announcement:The PayPal Digital WalletThe PayPal Card ReaderPayPal Here accepted around the world.The PayPal Digital Wallet can currently only be used at merchants that have elected to participate in PayPal's retail payment system. However, a merchant that participates in PayPal's retail payment system will be able to accept Visa, MasterCard, Discover and American Express along with PayPal of course.The Pay Pal Digital WalletPayPal has a new vision of how people will use and interact with their Payment Cards and by extension how they will use a Wallet application. This centers around the concepts of payment flexibility and discounts, loyalty and offers. PayPal spent a lot of quality time with regular folks across the country and looked at how they actually interact with what is now primarily Digital Money. Through the wise use of industry veterans and with a mandate to follow the path where it leads them, PayPal has constructed a rather genius way to interact with Payment Cards and other systems that hold value like a gift card or loyalty cards.The primary features of the PayPal Digital Wallet are:Grace Period - This separates the actual purchase from the payment by offering a 5-7 day grace period for consumers to change the underling Payment Card. This means that days after you leave a store you can shift a purchase to another Payment Card or divide it between other Payment Cards, Gift Cards, Loyalty Cards or a Bill Me Later loan.Installment Payments - Allows consumers to choose to create, ex post facto installment payments on larger purchases. This means that an emergency refrigerator failure can be a less intrusive experience by allowing the consumer to divide the transaction into multiple timely payments.Personal Lists - Allow for system wide searches for particular products and allows for comparison of prices. The consumer can then create shopping lists based on the results of the searches driving customers into PayPal Retail merchants.Found Money - The PayPal Digital Wallet will locate customized deals, coupons and one time offers for items in a personal list. With consumer permission, once the customer is in a merchant location that accepts PayPal’s solution, the merchant can target offers based on the shopping lists that the customer has created. This means situational offers can be made in real time.Spending Rules - This is a budgeting tool that creates specific fund “set asides” like travel funds and sets rules by purchase amount and ties specific Payment Cards to specific merchants. This allows for Payment Card “Air Mile” partnerships, like what American Express has with Wholefoods Market, to activate without a thought on the part of the customer.PayPal is betting on the premise that these features will at some point become valuable enough for the consumer to download the Wallet App to their smartphone. There seems to be enough compelling reasons to suggest that typical folks would be motivated by both the payment flexibility and the potential access to better prices through discounts and offers.Potential Real Life Use Cases You Will Not Find As A Glowing TweetDuring the 28 years I have spent in the Payments Industry, I can think of many use cases for some of the features found in PayPal’s Digital Wallet. One of our merchant was a multiple location automobile transmission repair company. They were very early adopters in accepting Payment Cards and it is easy to see why with typical transactions over $1,500.When your car is towed into a transmission shop, it is usually not a low cost repair. Most folks perhaps can scrape together money from credit lines, savings and "rainy day funds" but this is still a rather large sum. I had many conversations with the owner over the years and it always centered around his frustration around making payment easier for his customers. Today with the flexible funding options and on-demand installment payments, his customers would have more options then the traditional payment system. There are a number of other use cases which may not seem natural to people who are compulsive users of High Tech.The PayPal Card ReaderThe PayPal Card Reader is the work of industrial design genius Yves Behar (http://en.wikipedia.org/wiki/Yves_Béhar). Yves design language has always leaned towards a decidedly "form follows function" ethos with bold colors and unconventional approaches.We can see this in the new Card Reader in the way it can swivel back and move in to position. He addressed the issues a merchant faces with just about all devices in this class: The actual swiping of the card. This is actually not a trivial task to perform with any product on any smartphone.Even the best designed devices will present challenges to regular users. Yves has approached the issue by finding the optimum balance between maximum design efficiency and the budget constraints of a device which will be given away for free. The Reader is already the punch line of quite a number of jokes, such as: The Blue Dorito. Love it or not, it can be argued that its design is a bold statement. Time will tell how much this will ultimately impact the users of the device.Encryption And Card Data SecurityThere is more to the Card Reader than just appearance. The device has active electronics that encrypt the card data before heading over to the smartphone's 3.5mm Audio Input Jack. The issue of end to end encryption on smart phones using a Payment Card processing devices has been under a great deal of scrutiny by the Payment Card companies.Currently not a single device that uses a smartphone in this manner is considered fully compliant under the PCI guidelines (https://www.pcisecuritystandards.org/) this includes PayPal and the new card reader. At some point there will be a need to certify these card readers and Visa has already stated that there will need to be hardware encryption built into the devices. PayPal has already addressed this issue with this release. The first most people have heard of these issues was with a ridiculous marketing campaign by Verifone against Square: How will Verifone's "Open Letter"/"Wake-up Call Letter" affect Square and its Card Reader?. It failed for Verifone, it may or may not help PayPal. Square has an Encrypting card Reader they have been testing for quite some time and is now shipping, however the installed based of Square merchants have the old reader. I am certain Square will address this issue.Follow The Magnetic Strip, Around The WorldPayPal wisely limited the release of this service to countries that still actively allow Payment Cards to be used at merchants with Magnetic Card readers. This allows PayPal to maximize penetration in the first phase of this release. As PayPal rolls out to countries that use the EMV system, we will see a 2.0 version of the card reader that allows for EMV transactions. There will also be considerable increase in unit costs for the device and this will be an issue to be concerned about.The PayPal Merchant Processing AppThe merchant app has a number of standard and unique features. There are the traditional functions that one would expect, the ability to process a card by a swipe or by manual key entry. However there is an option to image and process checks also. There are email receipts and text based receipts. The more unique features allow for a merchant to create and deploy store-wide universal offers and discounts and customized deals crafted by preset and based on the contents of the shopping lists of PayPal wallet users.A Clone Of Square's Card CasePayPal using Geo-fencing technology to allow users of the PayPal wallet to pay just by being close to the checkout line. The feature they call "Local" may sound rather familiar, this is because in many ways this is a clone of Square's revolutionary CardCase system. I have seen PayPal's system in use and can say that it is a rather different experience than the one with Square's Card Case.The Merchant Processing RateThe flat rate of 2.70% that currently offers a 1% Cashback (with caveats) to the merchant with no fixed transaction fee is currently significantly lower than any other company offering a similar solution, but it may not be low enough to matter at this point. This will likely change soon for a number of reasons. PayPal is in a rather unique position to actually have a lower overall wholesale cost and this will grow logarithmically as they pull in more Digital Wallet users. The rate a merchant pays is really not a direct concern to most customers and thus this is really more of a merchant adoption issue.There is a bit of confusion that I think will be cleared up shortly on the how a merchant can receive the 1.70% rate. Thus far it seems that the PayPals price point of 1.70% with no fixed transaction fee is clearly aimed at Square and the current rate of 2.75% they offer. But it may be a bit of a marketing claim which will not really net merchants any significant savings in the short to medium term. However it will be more than challenging for Square to directly address this issue in the short term. I will assume that the data I have from the last few months is correct and thus it would work out in this manner:Example of a average merchant with 100% use of the PayPal Debit Card:$1000 per month with 100 transactions,PayPal $1000 x 1.70% (with Cashback PayPal debit card rebate) = $17.00Square $1000 x 2.75% = $27.50Differential Potential = $10.70 x 12 = $128.40 per year-Or-Example of a average merchant with 0% use of the PayPal Debit Card:$1000 per month with 100 transactions,PayPal $1000 x 2.70% (with no Cashback PayPal debit card rebate) = $27.00Square $1000 x 2.75% = $27.50Differential Potential = $0.50 x 12 = $6 per yearIn reality the savings will be someplace in the middle at some point.This 1% Cashback rebate is a rather bold move to boost adoption and will no doubt be removed once market density has been reached. But it requires the merchant to use the PayPal branded Debit Card to spend money rather than withdrawing the amount. This card is free of charge and PayPal aims to send them out to a majority active of PayPal account holders in the launch countries. This keeps the funds from the merchant account theoretically locked in PayPals's walled garden and allows then to collect the Interchange fees when the card is used by the merchant to make purchases. Interchange fees are passed through the Visa and MasterCard system and given back to the bank that issued the card, in this case The Bankcorp on behalf of PayPal.Have no doubts, this is a rather strong bottom line perception for a vast majority of merchants. Lost in the haze will be the fact a merchant will not always get 1% back and there is a wait for the rebate, up to one year. The 1.70% marketing rate may not be enough in and of itself. I am certain much will be made of this real or imaginary cost saving.PayPal has also announced that they will be doing same day funding on most transactions. There will be limits and controls on the transaction size and transaction volume that they will allow small merchants to process.Electronic Check AcceptancePayPal has wisely extended instant payment acceptance to checks also and although checks are used less and less at retail locations, it is a genius move to extend deeper into the galaxy of payment options.Camera Based Payment Card ReadingPayPal has licensed the technology from Card.io which allows for the image of the card to be scanned and processed with out the need of the merchant to key in the card number. I addressed issues that this technology faces here: What is Card.io and how will it impact the mobile payment space?. It is an interesting feature but I feel that it will not be used very often.On Demand Invoicing For Service BusinessesPayPal included a unique tool that allows business that are in the repair, contractor or service industry to create a pro forma invoice sent from the phone directly to any email address in the world. More interesting is that it is a realtime notification to the customer if they are running the PayPal Digital wallet. This will be a very important feature for a number of business sectors.The Chicken Or EggWhen one surveys this new move by PayPal and take in the entirety of how this could impact the market, one can say that this is a rather bold move but necessary move. Executives at PayPal have been very public in stating that this is their market to lose and they are going to do just about anything to take a reasonable percentage of market share.I can personally verify that PayPal wisely chose to reach out to experts that had real street experience with Merchants and the Payment system, and the needs of actual consumers. They clearly have taken most of the advice that was offered. This goes a long way in addressing the potentials of success for this system in the marketplace. However PayPal faces the same "Chicken or egg" problem that every bold new entry in this market faces, from the Square Card Case to the ISIS wallet, Google's Wallet and others: merchants need more than just great ideas, sexy products and simple rates. Pragmatism and practicality always rule the day with the 99% of merchants who are not early adopters. This will be the largest barrier every company will face.For PayPal to be successful they are going to need to be very persuasive on all points and then they would have to develop effective systems to actually reach the 99% of merchants that have been proven to be nearly impossible to reach with online advertising and social media "viral" campaigns. Much to the dismay of many companies even phone marketing campaigns have little effect. There are a number of highly successful ways to reach this market and one of the best guarded secrets is business to business (B2B) sales. Few of the new companies offering retail payment solutions have decoded this process. At some point they will need to address this issue after the momentum of just reaching for the low hanging fruit on the tree has peaked.PayPal’s ImageIt is no secret that PayPal’s image in the mind of some online merchants is just a little bit more than tarnished. Some of it is deserved. However some of it is tied up in the complexity of running in the middle between Cardholders and their needs and merchants with a differing set of needs. Every company that is in this industry will face these challenges, even the ones that appear to currently have a great reputation. The moment one becomes a merchant they discover all the tools they had as a consumer can very well be used against them even if it is not warranted.The ChargeBack dispute system is not perfect and always errs on the side of the Cardholder. This issue, and the related numerous fraud issues, create a dangerous environment of potential hostility between Paypal and the merchants. PayPal has a legacy here, as well as the legacy they created by making some very poor choices in how they deal with popular issues. This potentially tarnished reputation will absolutely impact merchant adoption. But I would caution any company in this industry from using this as a marketing tool, it will ultimately set a standard that may be impossible to achieve in long term.Are The Features And Costs Good Enough?There are a number of ways one can look at the perception of success. For PayPal success may be to gain a low double digit of the true transaction volume of retail merchants. The temporary low rate will greatly assist in this effort. We will not see any company dominate the entire market as long as they have to use the networks and products of the current Payment Card Companies. Other companies that will compete with PayPal will no doubt have less customers then they would have had if PayPal was not in the market. However as long as they continue to innovate I am certain they will do this and perhaps more and meet with continued success also. My advice is "heads down" and "iterate" is foolish, "heads up" and look around you, seek out the history and people that know the topography and perhaps have a map.The Merchant And The Consumer Will VoteThe showdown between all of the existing and new companies in this market will be an exchange of historic proportions. There are no underdogs in this race, billions of dollars are backing all serious players. Most in the tech world will choose sides and carry the flag, but this can be a kiss of death. The control is primarily in the hands of merchants and I can personally attest to the fact that that they have become deaf to most of the latest ideas that we in Technology have cooked up. The company(s) that are wise enough to seek the expertise and wisdom of how to truly reach these merchants and by extension their customers will have the greatest success.Update: Videos from the launch event, thanks goes to Rakesh Agrawal's keen eye:

Ever wondered what a demat account is? How to choose the best demat account for you?For you to become financially independent, you need to start building on your financial assets; these may be anything from equity, mutual funds, bonds, IPO debentures, gold etc. You have to remain invested in a particular financial asset(s) for an extensive period. However, to achieve this, adequate financial planning is required. You need to endure a bit of risk as well as secure yourself to generate the maximum yield from your investment. For investing in the Indian stock market, you need to have a demat account.You should not settle for mediocrity for your demat account. But, choose the best option, which requires some homework and precision planning. To open a demat account, you have to select a depository that would be best suited for you to trade in the share exchanges. Consequently, you have to choose the best Demat account for trading to begin your journey in investing shares.A demat account is opened to buy or sell shares. As per SEBI – Securities and Exchange Board of India, every individual who intends to invest via purchase or sale of shares either electronically or by way of physical share certificates through the stock exchanges are required to set up a demat account. You cannot trade in shares if you do not have a legitimate demat account.There are many banks and financial institutions which provide the facility to the investor to open a bank account. There are even private brokers who offer assistance to new investors. However, one has to choose the best for their investment purpose.Below are a few things to consider on choosing the best demat account in India:Simple Account opening:The first step should be the simplest, that is the account opening formality should be extremely simple for you - the investor.SEBI has directed a detailed process of opening a demat account which the DP – Deposit Participant(s) must follow. Furthermore, DPs can further simplify this process to a great extent.For instance, the best demat account that is convenient for the investor can be opened through the e-KYC process, wherein the entire process of account opening is validated using the investor’s Aadhar data. This e-KYC process is carried out only online, and the investor needs only to do a final self- identification either through an in-person verification that is physical verification or through a video camera. However, a trade must be carried out in less than two days of account opening. Whereas, if an account has been opened through the physical format that is filling in a form and going in person, the trade must be conducted in less than five days.Furthermore, SEBI has mandated every DP to provide investors with the Basic Services Demat Account (BSDA), which promises to provide limited services at reduced costs to retail investors. It gives an option of an online Demat account facility. These accounts are also known as no-frills or basic demat accounts. Moreover, SEBI states that every DP will make basic trading accounts available with limited and essential services at reduced costs.The Basic Services Demat account makes for one of the best online demat account options for the inexperienced investor. The charges for the BSDA account shall be highlighted in the following point.Economical Demat Account Charges:Another pointer to consider is the price point of the DP and account charges.Opening a demat account has a cost, even if it means that no transactions are carried out throughout the year and your account is idle. Today, banks, financial institutions, depository participants, brokers, etc., most of the time, do not charge any fees for opening a demat account. However, when you calculate the cost of the demat account, you need to consider all the charges.Let’s look at all the charges levied to consider for choosing an ideal demat account:There is an annual maintenance charge -AMC that is billed to the investors account year on yearA fee is charged each time there is a debit from your demat accountCharges are applied if you request for a physical copy of your demat holding or physical transaction copyIf your Debit instruction Slip – DIS or Demat Request form – DRF is rejected your demat account incurs a costIf you hold shares in physical format, particular DPs charge to convert the share certificates from physical form to an electronic oneIf you opt for a BSDA account, the AMC structure is straightforward and provided via a slab basis. If your account value is up to INR 50,000, then there will be a NIL amount levied for AMC. However, for a value holding from INR 50,001 to INR 2,00,000, the AMC fee will be up to INR 100. This seems to be the most accurate fee structure to consider choosing the best demat accountHowever, some DPs also provide zero AMC demat accounts, wherein they waiver the AMC charges. Moreover, they either offer a limited time no AMC demat account, for instance, providing you with no AMC charges for the first year or a lifetime offer of no AMC demat account charges.These are a few points to consider regarding the charges when choosing or opting for the best demat account in India.The seamless interface between Banking and Broking:A very crucial aspect for choosing the best demat account for you should be a seamless process between your bank account and your broking account. This means that, when investing and trading in equities on a day to day basis, there is a shift towards the digital platform by investors for the ease of using the internet and trading apps to complete the trades. This requires a proper linkage of your bank account and your demat andTrading account.2 options are available, 2-in-1 accounts or 3-in-1 accounts. The 3-in-1 account links your bank account, your demat account and your trading account. This is mainly offered by those brokers who have group banking licenses; majority banking institutions provide the 3-in-1 account.How does a 3-in-1 account work? (i) The investor transfers a particular amount from the savings bank to the trading account; (ii) the trading account, that has its unique Id carries out the trade that is buying and selling of securities; (iii) the purchase of share credit is reflected in your demat account. The demat account is utilised as a bank wherein the shares bought are deposited, and the shared sold are withdrawn.Majority of the time, private DPs or financial institutions which provide the facility to the investors for a demat account as well as a trading account, offer a 2-in-1 account. This account extends a seamless system to transfer money and a link between the trading and demat account, which works most of the time.To summarise this tip, as long as the customer is provided with a seamless interface between the bank account, the trading account and demat account for an economical and straightforward transfer of money and service, the purpose is adequately fulfilled.In-depth Data Analytics:A vital factor to keep in mind is the availability of data. Today Depository Participants (DPs), financial institutions, banks, etc., are out-spreading their services beyond the plain vanilla account statements.These days DPs provide a host of online data analytics like real-time valuation, direct call to action requests for trading clients, analytics on demat inflow and outflow, timely alerts, dominant market players, industry concentration, thematic concentration, consolidated portfolio outputs among other things.In the current day and age, financial analysis is no longer only limited to examining share prices and share behaviour. These analyses are integrated with external factors which play a vital role in the performance of a share such as social and economic trends within the economy, the political environment and volatility, consumer behaviour, preferences etc. All this put together have the probability of affecting the company, industry which indirectly affects the share price.Hence, value additions such as data analytics, provide a great advantage for the decision making of the investor in choosing the best demat account available.Hygiene factors are essential to consider are:How efficiently does your DP carry out the transaction?Does he provide you with the best possible share price and assist you in tracking the market?How quickly does your DP manage the dematerialisation of physical shares?Are the demat debit and credits processed on time?What is the overall view about the quality of services provided by the DP?Are there any service-related complaints of the DP pending with either SEBI, NSDL or CDSL?Is there is any negative news about the DP and his company?These questions determine whether the DP is committed to offering high service standards.These are the main features or tips to consider when choosing the best demat account in India:The most secure way to trade is through the assistance of versatile Depository Participants.The demat account registered with the DP should provide an efficient and quick service.Online platforms which are aplenty today are your one-stop destination for all trading and investment requirements on the go.Real-Time updates and tracking on mobile apps through online trading and demat account are very much in demand.Research reports and recommendations provided by the DP is a value-added service for the investor to assist him through his investment journey.There is a plethora of companies, banks, financial institutions, Broking companies that offer all the above services or are limited to a few. It is best to keep in mind all the tips when considering to choose the best demat account, which is the best fit for you.ThanksHope You like the Answer. Request you to please upvote and Share my Answer.If you want to open a Demat Account, Please use the link above-in my profile. If you open the Accounts through the links you won’t pay a Penny More, but we will get a Small commission, which helps keep the lights on.

These are the highlights of the Railway Budget 2016Theme of the BudgetOvercoming challenges - Reorganize, Restructure Rejuvenate Indian Railways: 'Chalo, Milkar Kuch Naya Karen'Three pillars of the strategy i.e. Nav Arjan - New revenues, Nav Manak - New norms, Nav Sanrachna - New Structures.Financial Performance 2015-16: Savings of Rs. 8,720 crore neutralizing most of the revenue shortfall, expected OR 90%;2016-17: Targeted Operating Ratio (OR) - 92%, restrict growth of Ordinary Working Expenses by 11.6% after building in immediate impact of 7th PC, reductions planned in diesel and electricity consumption, Revenue generation targeted at Rs 1,84,820 crore.Investments and ResourcesProcess bottlenecks overhauled including delegation of powers to functional levels; average capital expenditure over 2009-14 is Rs. 48,100 crore, average growth of 8% per annum.2015-16 investment would be close to double of the average of previous 5 years.2016-17 CAPEX pegged at Rs. 1.21 lakh crore; implementation through joint ventures with states, developing new frameworks for PPP, etc.VisionBy 2020, long-felt desires of the common man to be fulfilled i.e, reserved accommodation on trains available on demand, time tabled freight trains, high end technology to improve safety record, elimination of all unmanned level crossings, improved punctuality, higher average speed of freight trains, semi high speed trains running along the golden quadrilateral, zero direct discharge of human waste.2015-16-AchievementsAction initiated on 139 budget announcements of 2015-16.Project execution2015-16: assured funding through LIC; commissioning of 2,500 kms Broad Gauge lines; commissioning of 1,600 kms of electrification, highest ever. In 2016-17 -targeted commissioning 2,800 kms of track; commissioning Broad Gauge lines at over 7 kms per day against an average of about 4.3 kms per day in the last 6 years. Would increase to about 13 kms per day in 2017-18 and 19 kms per day in 2018-19; will generate employment of about 9 crore man days in 2017-18 and 14 crore man days in 2018-19. Outlay for railway electrification increased in 2016-17 by almost 50%; target to electrify 2,000 kms.Dedicated Freight CorridorAlmost all contracts for civil engineering works to be awarded by March 31st 2016; Rs 24,000 crore contracts awarded since November 2014 as against Rs 13,000 crore contracts awarded in last 6 years; propose to take up North-South, East-West & East Coast freight corridors through innovative financing including PPP.Port connectivityTuna Port commissioned and rail connectivity projects to ports of Jaigarh, Dighi, Rewas and Paradip under implementation; implementation of rail connectivity for the ports of Nargol and Hazira under PPP in 2016-17.North EastBG Lumding-Silchar section in Assam opened thus connecting Barak Valley with rest of the country; Agartala brought on to the BG network. States of Mizoram and Manipur shortly to come on BG map of the country with commissioning of the Kathakal-Bhairabi and Arunachal-Jiribam Gauge Conversion projects.Jammu and KashmirWork on Katra-Banihal section of Udhampur-Srinagar-Baramulla Rail Link Project progressing satisfactorily- 35 kms of tunnelling out of total of 95 kms completed; Decongestion work on Jalandhar - Jammu line in full swing and doubling of two bridges to be commissioned by March 2016, while the other two bridges will be completed by 2016-17.Make in IndiaFinalised bids for two loco factories; proposed to increase the current procurement of train sets by 30%.Capacity Building for the future through:1. Transparency: Initiated recruitments online in 2015-16, process now being replicated for all positions, social media being used as a tool to bring in transparency, all procurement including procurement of works moved to the e-platform, completed trial of process leading to award of tender electronically and to be rolled out on a PanIndia basis in 2016-17.2. Governance: Delegation led to compression of project sanction time to 6-8 months from 2 years earlier, key result areas identified to judge performance of GMs and DRMs, performance related MOUs signed with few Zones, to be replicated for all zones.3. Internal audit measures: Specialised teams mandated to screen railway operations in specific areas to detect inefficiencies and prevent wastages, every zone preparing 2 reports by March 31, 2016.4. Partnerships: Cabinet approval for JVs with State Governments, 17 consented and 6 MOUs signed with State Governments. 44 new partnership works covering about 5,300 kms and valuing about Rs. 92,714 crore have been indicated in the Budget documents.Customer Interface1. Interaction and feedback through social media & dedicated IVRS system.2. Making travel comfortable by generating over 65,000 additional berths, installing 2,500 water vending machines; introducing 'Mahamana Express' with modern refurbished coaches; 17,000 bio-toilets in trains; world's first Bio-Vacuum toilet developed.3. Improving punctuality: Operations audit for Ghaziabad to Mughalsarai section.4. Ticketing: Introduced 1,780 Automatic Ticket Vending Machines, mobile apps & GoIndia smartcard for cashless purchase of UTS and PRS tickets, enhanced capacity of e-ticketing system from 2,000 tickets per minute to 7,200 tickets per minute and to support 1,20,000 concurrent users as against only 40,000 earlier.5. Social initiatives: One-time registration for availing concessions while booking tickets online, online booking of wheelchairs & Braille enabled new coaches introduced for the Divyang, increased quota of lower berths for senior citizens and women, middle bays reserved in coaches for women.6. Wi-Fi provided in 100 stations, to be provided in 400 more.7. Stations being redeveloped - financial bid received for Habibganj, Bhopal; Cabinet approval for stations to be taken up under PPP.8. Security through helplines & CCTVs.9. Safety: 350 manned level crossings closed, eliminated 1,000 unmanned level crossings, 820 ROB/RUB completed in the current year and work going on in 1,350 of them.Other major achievements1. Energy: Annualized savings of Rs. 3,000 crore to be achieved in the next financial year itself, a year earlier than announced; achieved by procuring power directly at competitive rates using IR's status as Deemed Distribution Licensee.2. Rail University: Initially identified the National Academy of Indian Railways at Vadodara.3. Digital India: Application of Track Management System (TMS) launched, inventory management module of TMS has resulted in inventory reduction by 27,000 MT resulting in saving of Rs.64 crore and scrap identification of 22,000 MT equivalent to Rs.53 crore.The Way AheadImproving quality of travelFor the unreserved passenger -1. Antyodaya Express unreserved, superfast service.2. Deen Dayalu coaches - unreserved coaches with potable water and higher number of mobile charging points.For the reserved passenger -1. Humsafar: Fully air-conditioned third AC service with an optional service for meals2. Tejas: Will showcase the future of train travel in India. Will operate at speeds of 130 kmph and above.Will offer onboard services such as entertainment, local cuisine, WiFi, etc. through one service provider for ensuring accountability and improved customer satisfaction3. Humsafar and Tejas to ensure cost recovery through tariff and non-tariff measures4. UDAY: Overnight double-decker, Utkrisht Double-Decker Air-conditioned Yatri Express on the busiest routes, has the potential to increase carrying capacity by almost 40%.Ticketing: Sale of tickets through hand held terminals; e-ticketing facility to foreign debit/credit cards; bar coded tickets, scanners and access control on a pilot basis. Expansion of Vikalp - train on demand to provide choice of accommodation in specific trains to wait listed passengers. E-booking of tickets facility on the concessional passes available to journalists; facility of cancellation through the 139 helpline post verification using 'One Time Password' sent on registered phone number, to improve tatkaal services CCTV cameras on windows and periodic audit of PRS website.Cleanliness: 'Clean my Coach' service through SMS, ranking of A1 and A stations based on periodic third party audit and passenger feedback; waste segregation and recycling centres; 'Awareness campaigns'; additional 30,000 bio-toilets; providing portable structures with biotoilets at all platforms of select stations for senior citizens, Divyang and women travellers, plan to explore innovative means of providing and maintaining toilets such as advertisement rights, CSR, voluntary support from social organizations.Catering and stalls at stations: IRCTC to manage catering services in a phased manner; explore possibility of making catering services optional, adding 10 more IRCTC operated base kitchens; to build local ownership and empowerment, weightage will be given to district domicile holders for commercial licenses at stations.Stoppages: Convert all operational halts into commercial halts for the benefit of the common manRail Mitra Sewa: Expanding Sarathi Seva in Konkan Railway to help the old and disabled passengers, strengthening the existing services for enabling passengers to book battery operated cars, porter services, etc. on a paid basis in addition to the existing pick up and drop, and wheel chair services.Measures for Divyang: All stations under redevelopment accessible by Divyang; to provide at least one Divyang friendly toilet at each platform in A1 class stations during the next financial year and also ensure availability of wheelchairs in sufficient numbers at these stations.Travel Insurance to passengers: To offer optional travel insurance for rail journeys at the time of booking.Hourly booking of retiring rooms: Will be handed over to IRCTC.Janani sewa: Children's menu items on trains, baby foods, hot milk and hot water would be made available.SMART (Specially Modified Aesthetic Refreshing Travel) Coaches: design and layout of our coaches to ensure higher carrying capacity and provision of new amenities including automatic doors, bar-code readers, bio-vacuum toilets, water-level indicators, accessible dustbins, ergonomic seating, improved aesthetics, vending machines, entertainment screens, LED lit boards for advertising, PA system.Mobile Apps: Integrate all facilities into two mobile apps dealing with ticketing issues and for receipt and redressal of complaints and suggestions.Improving customer interface: Skilling our front-end staff and those we employ through our service providers, information boards in trains enumerating the on-board services and also GPS based digital displays inside coaches to provide real time information regarding upcoming halts. Work underway on installation of a high-tech centralized network of 20,000 screens across 2000 stations for enabling real time flow of information to passengers and also unlock huge advertising potential. All A1 class stations will be manned with duly empowered Station Directors supported by cross functional teams; to make one person accountable for all facilities on trains.1. Pilgrimage centres: To take up on priority the provision of passenger amenities and beautification on stations at pilgrimage centres including Ajmer, Amritsar, Bihar Sharif, Chengannur, Dwarka, Gaya, Haridwar, Mathura, Nagapattinam, Nanded, Nasik, Pali, Parasnath, Puri, Tirupati, Vailankanni, Varanasi and Vasco; also intend to run Aastha circuit trains to connect important pilgrim centres.2. Porters: Intend providing them with new uniforms and train them in soft skills, henceforth, to be called sahayak.3. High Speed Rail: Passenger corridor from Ahmedabad to Mumbai being undertaken with the assistance of the Government of Japan. SPV for implementing high speed projects will be registered this month. Prime benefit would be providing IR with technology advancements and new manufacturing capability.4. Entertainment: Propose to invite FM Radio stations for providing train borne entertainment; extend 'Rail Bandhu' to all reserved classes of travelers and in all regional languages.Passenger traffic: Suburban traffic: in-principle approval for MUTP III received. Early award of tenders for elevated suburban corridors between Churchgate-Virar and between CSTM-Panvel; revive Ring Railway system in Delhi; launching a new investment framework for developing suburban systems in partnership with State Governments, development in Ahmedabad, Bangaluru, Hyderabad Chennai and Thiruvananthapuram on the anvil.Winning back the lost modal share Expanding the freight basket of IR: To start time-tabled freight container, parcel and special commodity trains on a pilot basis, container sector would be opened to all traffic barring coal, specified mineral ores and part-loads during the non-peak season. All existing terminals/sheds would be granted access to container traffic, where considered feasible.Rationalising the tariff structure: Undertake review of tariff policy to evolve a competitive rate structure vis a vis other modes, permit multi-point loading/unloading and apply differentiated tariffs to increase utilization of alternate routes, explore possibility of signing long term tariff contracts with our key freight customers using pre-determined price escalation principles.Building terminal capacity: Proposed to develop Rail side logistics parks and warehousing in PPP mode, 10 goods sheds will be developed by TRANSLOC, the Transport Logistics Company of India, in 2016-17. To soon inaugurate India's first rail auto hub in Chennai. Encourage development of cold storage facilities on vacant land near freight terminals. Local farmers and fisherman would be given preferential usage of the facility. A policy in this regard would be issued in the next 3 months.Nurturing customers: Will appoint Key Customer Managers to liaison with our major freight stakeholders; each Zonal Railway will develop customer commitment charter indicating service level commitments of IR, will explore the feasibility of opening up leasing of general purpose wagons.Non fare revenuesStation redevelopment; monetizing land along tracks; monetizing soft assets - website, data, etc; advertising - in 2016-17 target 4 times the revenue of 2015-16; overhaul of parcel business - liberalize the current parcel policies including opening the sector to container train operators; revenues from manufacturing activity - by 2020, aim at generating annualised revenues of about Rs 4,000 croreProcess Improvements1. EPC projects standard document finalized, will implement at least 20 projects through this mode in 2016-17; by 2017-18, endeavour to award all works valuing above Rs. 300 crore through EPC contracts.2. Performance output parameters based contracts - to review service contracts to integrate them and make them simpler and outcome focused.3. Leveraging technology for project management- intend to use the latest drone and Geo Spatial based satellite technology for remotely reviewing the physical progress across major projects; monitoring of DFC to be operationalised through this mode in 2016-17.4. System-wide Information Technology integration - initiated system wide integration, both horizontal and vertical, akin to an ERP through innovative partnership models.Rail Development AuthorityTo enable fair pricing of services, promote competition, protect customer interests and determine efficiency standards; draft bill to be ready after holding extensive stakeholder consultations.Undertaking Navarambh - A new beginningNavinikaran - Structural InterventionsOrganisational Restructuring- Proposed to reorganize the Railway Board along business lines and suitably empower Chairman, Railway Board. As a first step, cross functional directorates to be set up in Railway Board to focus on areas like non-fare revenues, speed enhancement, motive power and information technology; explore the possibility of unifying cadres for fresh recruitment of officers; strengthen PPP cell to improve ease of doing business with IR.Sashaktikaran - Improving our planning practicesTo set up a Railway Planning & Investment Organisation for drafting medium (5 years) and long (10 years) term corporate plans; identify projects which fulfill the corporate goal. Prepare a National Rail Plan to harmonise and integrate the rail network with other modes of transport and create synergy for achieving seamless multi-modal transportation network across the country.Aekikaran - Consolidation: Forming a holding company of companies owned by IR.Shodh aur vikas - Investing in the future: to set up a R&D organization, a Special Railway Establishment for Strategic Technology & Holistic Advancement, SRESTHA. RDSO will now focus only on day to day issues while SRESTHA would drive long term research..Vishleshan - Analyzing data: a dedicated, cross functional team called Special Unit for Transportation Research and Analytics (SUTRA) would be set up for carrying out detailed analytics leading to optimized investment decisions and operations.Navrachna - Innovation: by setting aside a sum of Rs 50 crore for providing innovation grants to employees, startups and small businesses.Avataran - Seven Missions for the transformation of IRMissions will be headed by a Mission Director reporting directly to the Chairman, Railway Board and heading a cross functional team empowered to take all relevant decisions for a timely targeted delivery. Annual outcome based performance targets for the Mission would be announced and the Missions will finalise the implementation plans for short, medium and long terms and proceed accordingly.Mission 25 Tonne for 25 tonne axle load, Mission Zero Accident for safety, Mission PACE (Procurement and Consumption Efficiency), Mission Raftaar for higher speeds, Mission Hundred for commissioning 100 sidings/ freight terminals, Mission beyond book-keeping for accounting reforms, Mission Capacity Utilisation to prepare a blueprint for making use of the capacity created once DFC is commissioned.Sustainability and Social Initiatives: Human Resources/ Skilling, Social initiatives, Environment1. To tie up with the Ministry of Health for ensuring an exchange between Railways hospitals and Government hospitals; to introduce 'AYUSH' systems in 5 Railway hospitals; provide gang men with devices called 'Rakshak' for intimating them about approaching trains, also reduce the weight of the tools carried by them while patrolling. To provide toilets and air-conditioning in cabs for our loco pilots.2. Set up two chairs: One C T Venugopal chair on Strategic Finance, research and policy development and another Kalpana Chawla chair on geo-spatial technology.3. For youth: Open our organisation to 100 students across Engineering and MBA schools for 2-6 months' internships each year.4. Partnering with Ministry of Skill Development - skill development on IR premises.5. Undertaken energy audits for reducing energy consumption in non-traction area by 10% to 15%: All new light provisions will be LED luminaire and all Railway stations to be covered with LED luminaire in next 2 to 3 years.6. Action plan drawn up for environmental accreditation, water management and waste to energy conversion. More than 2,000 locations provided with Rain Water Harvesting facility. In place of steel sleepers on steel bridges environmentally friendly composite sleepers made of recycled plastic waste will be used over all girder bridges.7. 32 stations and 10 coaching depots have been identified for installation of water recycling plants in the coming years.Tourism1. Partnering with State Governments for operating tourist circuit trains; recent upgradation of National Rail Museum, promotion of tourism through Railway museums and UNESCO world heritage Railways.2. To spread awareness about our National Animal, the Tiger, complete packages including train journey, safaris and accommodation to cover the wildlife circuit comprising Kanha, Pench and Bandhavgarh will be offered.