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Time of India
09-07-2025
- Business
- Time of India
Kotak Mahindra Bank aims asset growth at up to 2x India's nominal GDP: CEO Ashok Vaswani
Kotak Mahindra Bank aims to grow its assets at 1.5 to 2 times India's nominal GDP, Managing Director and CEO Ashok Vaswani said in the private lender's latest annual report. Brokerage firm Jefferies recently projected India's nominal GDP growth to slow to 9% in FY26. 'From a risk appetite perspective, we target to grow assets at 1.5 to 2 times nominal GDP growth,' Vaswani stated. 'In FY2024-25, our average advances grew by 18%, in line with our risk appetite, and average deposits by 16%, ensuring a balanced customer growth franchise.' Vaswani noted that the Reserve Bank of India 's technology embargo primarily impacted the bank's consumer business, while a broader downturn in the microfinance sector affected its commercial banking operations. by Taboola by Taboola Sponsored Links Sponsored Links Promoted Links Promoted Links You May Like Newcastle Upon Tyne: If You Were Born Between 1945-1974 You Could Be Eligible For This British Seniors Read More Undo 'Our Corporate Bank remained resilient and delivered growth for the Bank. Within the Commercial Bank, our Tractor Finance business was a standout performer, achieving a market share of 11.5%,' he said. Looking ahead, Vaswani flagged challenges arising from the expected decline in interest rates. 'As we move into the current year, managing the business through a regulatory repo rate cut cycle and identifying avenues for sustainable growth are key challenges that lie ahead,' he added. Live Events He also highlighted the impact of a turbulent global environment, saying, 'The heightened geo-political tensions and a rapidly evolving, volatile global economic order are new realities, compelling countries—including India—to realign.' Despite these challenges, he underscored the resilience of the Indian economy, which expanded by 6.5% in FY25. Growth picked up in the second half, supported by the RBI's accommodative measures, including interest rate reductions and liquidity infusions. As per the annual report, the total consolidated assets of Kotak Mahindra Bank stood at Rs 8.79 lakh crore at the end of FY25. Total advances stood at Rs 4.86 lakh crore while deposits were at Rs 4.94 lakh crore. Number of customers of the bank was upwards of 5.3 crores.
Time of India
17-06-2025
- Business
- Time of India
We would like to be DeepSeek in the West, says Essential AI cofounder
Dearth of collaborative efforts in AI domain may widen inequality around these capabilities even as pressures to monetise AI models which are 'difficult to ignore' may eventually lead companies to prioritise less on a long-term focus in research, said Ashish Vaswani , CEO and cofounder at Essential AI , a San Francisco-based AI startup. Vaswani, who earlier worked as a research scientist at Google Brain, is known for his pioneering contributions to the field of deep learning. In 2017, he co-authored the seminal paper 'Attention is All You Need' that broke new ground by introducing the transformer architecture which forms the foundation of generative AI applications like ChatGPT and its successors. Vaswani later cofounded Adept AI labs with another co-author Niki Parmar, before co-founding Essential AI with Parmar in 2023. The startup, backed by the likes of Google, Nvidia and AMD, builds full-stack AI solutions that enhance efficiency for automating labour-intensive and repetitive work. Its mission is to 'deepen the partnership between humans and computers.' Over the last few years, billions of dollars have been spent on scaling AI models, with less to show in terms of return on investments. Speaking to ET during this visit to India, Vaswani said this could impact AI research. 'There are several instances of companies shuttering the longer-term R&D efforts in interest of pouring all the resources into the money-making aspects, especially at a time of distress,' he said. According to him, the onus is on the leadership to ensure healthy long-term bets in addition to building a sustainable business. Discover the stories of your interest Blockchain 5 Stories Cyber-safety 7 Stories Fintech 9 Stories E-comm 9 Stories ML 8 Stories Edtech 6 Stories Further, in the pursuit of leadership in the AI arms race, companies are running the risk of ignoring important ideas. 'Any race forces you to take existing ideas that work, and pour resources into it to scale it up, while ignoring other riskier, and alternative but faster paths,' Vaswani noted. Lack of transparency A lack of openness, unlike earlier, is hindering the advancement of ideas, according to Vaswani. 'In 2017, there were many labs that could produce revolutionary ideas, and models are just an artifact of that spirit. It is never a single innovation but a series that comes together and then gives you these nonlinear improvements. The chance of that being widely shared is lower today,' he said. The end goal of creating artificial general intelligence (AGI) too is narrowing people's view, according to Vaswani. AGI is the stated aim of ChatGPT-maker OpenAI , for instance. 'I don't think of AGI as much as a state of progression, like growth in capabilities or intelligence growth. I don't think there is an end to these progressions,' said Vaswani. Need for open-source At Essential AI, therefore, the team is building an open science or open-source frontier model that everybody can control, said Vaswani. He explained that the idea is to put their work on frontier models out in the open so that others can build on them. This would include opening up its weights, and even to a certain extent data that they are using for training, he added. 'I think this is a strategic imperative because the point when we are able to reach the same level in the domains we care about, which is frontier, companies will trust our model more because they can see the process,' he said. On generating returns on investments from using open-source models, Vaswani said, 'I would not say it is trivial to make money as a closed-source model today, either - they are spending a lot of money, right?' He sees a growing market 'Having spoken with potential future collaborators and customers, they would love to use an open-source model in collaboration with us. I think there are business opportunities. I don't want to cast this moniker on us. But, in the short term, we would like to be the DeepSeek in the West,' he said, referring to the Chinese AI startup which rapidly gained prominence for developing high-performing and cost-efficient large language models.
Mint
06-06-2025
- Business
- Mint
The transformer birthed GenAI. Meet the man who built it
Eight years ago, Ashish Vaswani led a team of Google Brain researchers that invented the transformer, the magic sauce behind generative AI. The new model, which learns and generates human-like text, took the world by storm as it made its way into ChatGPT, and later, others like Gemini, Grok and DeepSeek. India-born Vaswani, whose startup Essential AI works on building foundational models, now wants to establish an India team, access graphic processing units, find clients and spot a local strategic investment partner. 'We're building foundational AI models to automate coding and tasks in science, technology, engineering and mathematics (STEM) applications. The core idea is to build the best models in specific fields, so that we can then partner with large clients who will licence our models to build applications on," Vaswani said in an interview. 'Could have never imagined it' In June 2017, Vaswani led a Stanford University research funded under Google Brain, floating the transformer model now regarded as one of the world's most significant inventions in computer science—alongside the likes of Frank Rosenblatt's neural networks, and Sergey Brin-Larry Page's PageRank. Asked whether he expected the model to have the kind of impact it did, Vaswani, who is in India after 16 years, said that he 'could have never imagined it." 'What I had set out to build was a better version of machine learning, and improving the way machine understanding worked. I never thought it would explode into what it is today, and the way it has taken over our lives." Also read | Generative AI, data centres to define India's tech industries in 2025 Vaswani, 39, is chief executive of Essential AI, which he co-founded in 2023 alongside Niki Parmar, a co-inventor of the transformer model. He stayed on at Google until 2021, leaving to build Adept AI Labs—a platform that today has a licensing deal with Amazon to build its AI initiatives. Vaswani and Parmar left Adept in less than two years over reported differences with investors, and started Essential AI. Fundraise GenAI burst into prominence when Sam Altman-led OpenAI, a Silicon Valley peer of Vaswani's, unveiled ChatGPT in November 2022. Since then, AI has become a household term, catapulting the field into prominence well beyond engineers and researchers. His startup, which raised $56.5 million in December 2023 and counts AMD, Google and Nvidia as investors, will be looking to raise a second, larger funding round of around $100 million later this year, Vaswani said. 'The results of our early foundational models are here, and they look good. We'll be using these results as a reference point for our next fundraise," he said. As part of this move, Vaswani is open to interest from Indian strategic partners as well. 'India has some of the brightest minds, and it is absolutely important that India pursues building its own AI. There's no reason why foundational work in AI cannot happen in India," he said. Read this | Mint Explainer: What OpenAI o1 'reasoning' model means for the future of generative AI Investors negotiating with global ventures concur, stating that foundational work in AI will have the scope to differentiate the work on GenAI that ventures across India and abroad are pursuing. Foundational AI 'One has to look at a big enough problem, and assess how many millions of people a problem impacts," said Anand Daniel, partner at venture capital firm Accel. "Then, we look at the solution being built, and the foundational engineering that a venture is undertaking in order to build for the problem. It's still early days, but the scope for foundational work remains broader in the US, than what Indian startups have so far created," Daniel added. Both agree that there is room for ventures to exist even in the foundational engineering space in GenAI in the long run, despite a battle for dominance playing out in the US among the likes of Google, Microsoft and OpenAI. 'I fully think that there is enough space now to build products and companies that exist alongside and outside the Big Tech environment, and that will further widen as generative AI evolves. Eventually, there is ample scope for many to disrupt the global technology environment," Vaswani said. And this | India's generative AI startups look beyond building ChatGPT-like models Foundational AI, to be sure, is seen as a tough to crack since it requires firms to build and train their own algorithms from scratch. While the advantages include the ability to have a proprietary AI model that squarely targets a specific use case, doing so requires significant working capital, a key challenge in India. Capability questions Vaswani, felicitated as one of India's 30 leading minds in AI by Accel in Bengaluru on Wednesday, is based in San Francisco. While Essential AI is headed by Vaswani and Parmar, the core team is in the US, highlighting the country's lack of focus on core engineering driven by access to capital being much lower than in the US. 'This is certainly an issue, and core engineering capability continues to lag in India. This is one key factor that we're also looking for in startups, but a lot of work happening here goes amiss in terms of core foundational work. Strategic companies doing foundational work will be key to progress in the field," added Prayank Swaroop, AI investor and partner in Accel. Vaswani, however, said the evolution of GenAI likely has to do a lot with philosophy, alongside computer science and mathematics. 'Is computer science more mathematics or philosophy? It is perhaps both. Steve Jobs was the first person to articulate that successful products are a blend of technology, the liberal arts and philosophy. This is what can lead to us doing visionary work. Eventually, we're building the philosophy of how the world should be. The ethos behind technology is to solve problems, and that's the only job of innovation," he said. And read | Gen AI pushes global firms to pour money into hardware upgrades
Mint
04-05-2025
- Business
- Mint
Microfinance stress, RBI embargo weighed on Kotak Bank's Q4 profitability
Mumbai: Kotak Mahindra Bank's profitability in the fourth quarter was dragged by stress in its microfinance portfolio and consequently slower growth in its agriculture and rural portfolio, even as the lender's operational metrics remained largely stable. The private sector lender's net profit in the December quarter fell 14% on-year to ₹ 3,552 crore. Sequentially, though, profit after tax was 7.5% higher. 'The microfinance business has gone through a very tough time, and that is what has contributed to the higher losses,' Kotak Mahindra Bank's managing director and chief executive officer Ashok Vaswani said in the post-earnings conference. Growth in the retail portfolio was also slow as the lender was unable to expand its high-yielding credit card book because of the Reserve Bank of India's embargo on the bank onboarding new customers. The embargo was lifted after 10 months in February. Vaswani said the bank's personal loan book saw good growth led by its acquisition of Standard Chartered India's personal loan portfolio in January. The corporate loan book also grew 'really well', he said. Customer assets, including advances and credit substitutes, rose 13% on-year to ₹ 4.8 trillion at the end of March. Loans, including inter-bank participation certificates (IBPC) and Bill Rediscounting Scheme (BRDS), were at ₹ 4.4 trillion, also up 13% on-year. Consumer loans were up 17% largely led by strong growth in mortgage, business banking and personal loans, whereas growth in the credit card business was 7% lower on-year. Commercial loans were up 6% on-year, with commercial vehicle, commercial equipment, and tractor finance seeing good growth. However, Kotak Mahindra Bank's agriculture portfolio grew a muted 1% on-year and its retail microcredit loan portfolio fell 33%. Corporate loans grew 6% and SME loans by 31%. 'Advances sort of reduced, but what we did was, we turned to build the credit substitutes such as commercial papers (CPs) and bonds etcetera,' deputy MD Shanti Ekambaram said, adding that the bank let go of some wholesale segments given the high pricing competitiveness in the segment. Vaswani said Kotak Mahindra Bank aims to grow its share of unsecured and personal loans to around 15% of its advances, compared with 10.5% now and around 12.7% before the credit card embargo and hit on microfinance. Unsecured retail advances, including retail microcredit, comprised 10.5% of net advances in the fourth quarter, mostly unchanged from a quarter ago and lower than 11.8% in the corresponding quarter of the previous year. Overall loan growth in 2025-26 is expected to be 1-1.5 times of GDP growth, Vaswani said, adding that Kotak Mahindra Bank aimed to maintain its credit-deposit (CD) ratio at 85-87%. The CD ratio was 85.5% on 31 March. Net interest income (NII) was up a muted 5% on-year at ₹ 7,284 crore. Net interest margin for the quarter was 4.97%. Chief financial officer Devang Gheewalla said NIM in the fourth quarter was supported by cuts on saving account rates and a financial year-end rise in average current account balances. Going forward, while higher lending in the unsecured credit card space would aid margins, overall, the margins would remain under pressure as the repricing on the liability side plays out, he said. The bank's gross non-performing assets ratio was 1.42% as of 31 March, worse than 1.39% a year ago but better than 1.50% in the previous quarter. Net NPA ratio at 0.31% had improved from 0.41% a quarter ago and 0.34% a year ago. Slippages during the fourth quarter were elevated at ₹ 1,488 crore, of which ₹ 135 crore were upgraded during the quarter itself. The bank wrote-off loans worth ₹ 873 crore during the quarter and saw recoveries and upgrades of ₹ 747 crore. Provisions were also high at ₹ 909 crore, significantly up from ₹ 794 crore a quarter ago and ₹ 264 crore a year ago. First Published: 4 May 2025, 11:12 AM IST
Mint
21-04-2025
- Business
- Mint
TDS on rent and contract work: How small taxpayers can avoid penalties
When a young Mumbai-based couple bought an apartment from a seller who resides outside India, they ensured that they fully complied with the rules on tax deducted at source (TDS). They deducted the tax at source at the higher 31.2% rate (includes cess) applicable to non-resident Indian (NRI) sellers and submitted it to the tax authorities on time. However, they missed one additional step: filing an e-TDS return. Consequently, the couple, who did not wish to be named, was slapped with a penalty of ₹ 80,000. Many individuals like this couple face penalties and interest charges each year due to missed steps in TDS compliance, often stemming from limited awareness. After the TDS amount is submitted, the deductor has to file the return within the last date of the quarter in which TDS is deducted (the 31st of July, October, January and March). The penalty for this default is a severe ₹ 200 per day, capped at the TDS amount. The TDS rate in the case of NRI property sellers is quite high at 31.2%, which means the cap equivalent to the TDS amount for the ₹ 200 daily penalty doesn't really help the tenant when the landlord is an NRI. The couple was late in filing e-TDS by seven months, which added up to about ₹ 40,000 for both individuals. Since they bought the property jointly, both were required to deduct TDS and file the return separately. Hence, they both paid a combined penalty of ₹ 80,000 for this slip-up. Individuals and HUFs that are not liable for tax audits were first brought under the purview of TDS in 2013 with the introduction of Section 194-IA that deals with tax deducted at source on the purchase of immovable property . Gradually, more sections on other types of payments were added to broaden the tax base. Mint lists out some key TDS provisions that small taxpayers should be aware of to avoid paying penalties through their nose. Being a tenant to an NRI landlord is a full-time job with multiple compliances. The tenant has to get TAN (tax deduction and collection account number) and mandatorily deduct 31.2% TDS (includes cess; applicable surcharge also to be added) on the rent every month, regardless of the rent amount. It must be deposited to the Income Tax (IT) department by 7th of the following month using Form 27Q. Next, the tenant must file a quarterly e-TDS return. 'Once the return is filed, the tenant must generate and issue a Form 16A to the NRI landlord — this is the TDS certificate showing tax deducted and deposited," said Ajay R. Vaswani, founder, ARAS and Company, Chartered Accountants. 'In contrast, when rent is paid to a resident landlord above ₹ 50,000 per month, the tenant can simply fill Form 26QC online, pay 5% TDS once in a year and be done — no TAN, no quarterly returns, no Form 16A. But for NRI landlords, even a simple rental agreement becomes a full-blown TDS compliance project for the tenant," said Vaswani. The tricky part is that the onus of verifying whether the landlord is a resident or non-resident is on the tenant. 'The tenant should ask for a self-declaration copy. If it turns out later that the landlord was an NRI and tax wasn't deducted properly, the tenant bears the brunt," Vaswani said. Also Read: New TDS rules for partnership firms: What you need to know When a person or entity engages a contractor for any type of work, TDS will be deducted under Section 194C and 194M. 194C is applicable to anyone engaging a contractor for construction, repair work or any other contractual services where the total payment is over ₹ 1 lakh in a year or a single payment is over ₹ 30,000. Chirag Wadhwa, proprietor at Wadhwa Chirag & Associates, Chartered Accountants said for individuals and Hindu Undivided Family (HUF) engaged into business or profession, it is only when their previous year's annual turnover exceeds ₹ 1 crore (in the case of business) or ₹ 50 lakh (for professionals) that they have to deduct TDS under 194C. 'In the case of any other entity, even if there is no audit requirement, TDS under 194C applies," he said. It should be noted that TDS is to be deducted on oral contracts also, even when there is no formal written agreement. '194C gets attracted to even mundane payments like advertisement, courier, house-keeping services, pest control and catering, among others," Wadhwa added. TDS rate is 2% when the recipient is an entity and 1% if it's an individual. 194C compliance mainly affects small entities like housing co-operations, charitable institutions and small proprietor firms. For instance, a small housing committee with less than 20 apartments may not have a full-time CA. So the committee head will have to volunteer to get TAN, which is mandatory for 194C TDS, and deposit the TDS each time a payment is made to the several contractors they may hire, like security, horticulturist, for maintenance work etc. What if a businessman is hiring a contractor to construct his personal house? In this case, section 194M comes in. TDS under 194M is for individuals and HUF who don't fall under 194C. '194M is applicable under two conditions – individual or HUF turnover is below the ₹ 1 crore/ ₹ 50 lakh threshold or even if they are liable for audit but are engaging a contractor for a personal purpose," said Wadhwa. So, a businessman building his own house comes under 194M as he/she fulfils the second condition. Bhawna Kakkar, CA and founder, Kakkar & Company, Chartered Accountants says section 194C is well-known among businesses as CAs typically ensure TDS compliance during audits. However, Section 194M is less commonly followed. 'It applies even to salaried persons if they make high-value payments for professional or contractual services. Since it doesn't require a TAN and often arises in personal transactions, awareness and compliance remain quite low." TDS under 194M is deducted at 5% rate if the aggregate amount of payments exceeds ₹ 50 lakh in a year. Some common contractual services that concern most individuals are constructing a house, hiring an interior decorator, paying a wedding planner or event manager, hiring a lawyer or any other professional, etc. 'The ₹ 50 lakh limit is per year and when it is breached, the payer has to deduct TDS even for the earlier payments (out of the subsequent payments to be released). He cannot deduct TDS from the first payment itself," said Prakash Hegde, Bangalore-based chartered accountant. Kakkar said for both 194C and 194M, each deduction requires a corresponding TDS return filing. 'For 194C, each time TDS is deducted, you'll need to file Form 26Q quarterly, reflecting all payments and TDS deducted. 194M is a challan cum statement deduction that is submitted along with TDS deposit. For this only PAN is sufficient for deductor as well as deductee." Also Read: Relying on rental income in retirement? Take these steps to protect yourself. Failure to deduct TDS carries severe penalties. A 1% monthly interest applies for non-deduction, 1.5% interest when TDS is deducted but not deposited and for delays in filing e-TDS return or challan cum statement, ₹ 200 per day, capped at TDS amount, until the return is filed. These penalties apply to all TDS provisions. TDS non-compliance is a running risk as the interest and penalties are slapped only when the income tax (IT) department flags a default. 'With the income tax department increasingly relying on data from various sources, including the Statement of Financial Transactions (SFT) that captures cash receipts above ₹ 2 lakh, such payments can easily be flagged, potentially leading to demand for tax along with interest and penalty," said Kakkar. However, in the case of NRIs, the consequences of non-compliance are more severe. 'In case of non-compliance, the tenant could become 'assessee-in-default". This means the tenant could be forced to pay the entire TDS amount out of their own pocket, even if the rent was already paid out," Vaswani explained. Over and above the penal interest and ₹ 200 daily fee for non-filing of return, tenants to NRI landlords can also be face additional penalty up to the full amount of TDS under Section 271C and even prosecution under Section 276B for willful default when the TDS is deducted but not deposited with the government, as per Vaswani. 'Unless the landlord later pays full tax and files a return, the burden stays on the tenant." Hegde said the ₹ 200 per day fee for non-filing default, especially, is quite an expensive one. He said property buyers quite often cough up this fee for many of the previous instalments in cases where they pay several installments when buying from a builder. 'When buying a house, under Section 194IA, the buyer has to deduct 1% TDS on the total amount if it exceeds ₹ 50 lakh or more. Now, in case of several instalments, the buyer has to deduct and deposit the same using a challan-cum-statement of TDS in Form 26QB for each installment, which the builders may not inform buyers. Say, if there are eight instalments over three years and the buyer doesn't realise until the final instalment, the ₹ 200 daily fee on the first instalment will add up over three years, capped at the TDS amount. The same will apply to all seven instalments missed." In the first such instance, the tax department recently sent notices to many tenants claiming HRA for not deducting TDS. It is expected that the IT department could impose large-scale enforcement for other TDS provisions too in the coming years. Also Read: Claimed HRA but skipped TDS on rent? The taxman wants answers
