And one more Goodbye from India - bye Ford
First GM, then Harley Davidsons and now Ford Motors exit India
This week was relatively not much happening as the markets moved a mere 0.3% on weekly basis. But Midcaps and small-caps outperformed the major indices!
"Indian indices failed to maintain the momentum it witnessed during the previous week as volatility remained high due to weak global markets and the absence of any fresh domestic cues to lift the market further. Increasing COVID-19 cases across the globe also added to the market worries. Though the much-awaited US job data fell below market estimate, it gave relief to the market on hopes of continued economic support by the Fed," said Vinod Nair, Head of Research at Geojit Financial Services.
The market is hovering in the 17250-17400 range, but in all, a positive and cautious approach should be kept while trading at these levels.
Disclaimer: This is not a piece of investment advice, this article is just for informational purposes only!
Bid Goodbye to Ford
Ford India has decided to stop manufacturing vehicles at its two plants in India. This will have many consequences as well as slight changes in the Indian automobile industry.
Why is it leaving India?
The company has been facing huge losses for the past few years. It has accumulated losses of over $2 billion in the past 10 years and owns only 1.8 percent of the Indian market.
Before Ford, companies like Harley Davidson and General Motors have also left India.
How was its performance?
The performance of Ford in India had been quite bad and they tried to crack a deal with Mahindra & Mahindra which didn’t reach a positive conclusion. If both had signed for the deal, then Ford could have continued producing cars at a lower cost than its present cost but would cease its independent operations.
Where did it go wrong?
Ford had less than 2% of the market share in the last 10 years. Whereas, a Japanese company, Maruti Suzuki, and South Korean company, Hyundai were ruling with 60% market share. In layman's terms, it failed to understand consumer requirements and could have done a better job at market research.
The conclusion is, more than 4000 employees will suffer due to this and we might miss some amazing products by Ford in the future.
Tokenization - One more step towards Financial data protection
RBI has recently announced that no entity in the card transactions or payment chain other than the card issuers and/or card networks, shall store the actual card data, with effect from 2022.
For operational and other tracking services, entities can store limited data like few digits of the card and the name on the card using tokenization services. This brings us to the question of its relevance. Tokenisation refers to the replacement of actual card details with an alternate code (non-sensitive data) called the "token", which shall be unique for a combination of card, token requestor, and device.
So How will it work?
This tokenization and detokenization can be done only by Token Service Providers (Card Networks and Card Issuers) with explicit customer consent. Tokenisation can be used to secure sensitive data by replacing the data with unrelated value to be given to, let's say, merchants. This is to ensure that you don't give away your card details to every person you do transactions with (like online merchant sites). This clears sensitive data like payment card or bank account numbers with a randomized number in the same format without any intrinsic value of its own and could be deciphered only by an appropriate key.
This differs from encryption in the sense that, in encryption, a number is mathematically changed, but its original pattern is still stored within the new code. Earlier, when we made payments through cards from Point of Sales machine or any merchant website (Amazon or Zomato) then these merchants used to store our card information for further processing. But with tokenization, when we enter our card details on a merchant site, a token will be generated by the card networks (Visa or RuPay) and it will be sent to our mobile (or tablet) and this token then we will enter on the merchant website and the merchant website will not be able to store card details. In the absence of personal data security law, this may ensure the security of the transaction ecosystem given its emphasis on international best practices.
What do you think of this move by RBI, will it make our online transactions safer or just add more friction in the process? Let us know in the comments
Book of the Week
No matter your goals, Atomic Habits offers a proven framework for improving--every day. James Clear, one of the world's leading experts on habit formation, reveals practical strategies that will teach you exactly how to form good habits, break bad ones, and master the tiny behaviors that lead to remarkable results.
If you're having trouble changing your habits, the problem isn't you. The problem is your system. Bad habits repeat themselves again and again not because you don't want to change, but because you have the wrong system for change. You do not rise to the level of your goals. You fall to the level of your systems.
Atomic Habits will give you a proven system that can take you to new heights!
Tweet of the Week
Kunal Shah is an Indian entrepreneur, famously known for founding Freecharge and Cred. He also tweets very insightful posts around entrepreneurship and the Indian Startup Ecosystem