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<keyword id="21333142" type="General" weightage="100" keywordseo="Indias-population" source="keywords">India's population</keyword> is projected to peak in the early 2060s at about <keyword id="22386427" type="General" weightage="20" keywordseo="1-7-billion" source="keywords">1.7 billion</keyword> and then decline by 12%, but the country will remain the world's most populous throughout the century, the <keyword id="19896118" type="General" weightage="20" keywordseo="United-Nations" source="keywords" meta.keywordsubtype="org" meta.entityname="United Nations" meta.hostid="153" meta.entityid="United Nations">United Nations</keyword> has said. The World Population Prospects 2024 report, released on Thursday, said that the world's population is expected to continue growing over the coming 50-60 years, reaching a peak of around 10.3 billion people in the mid-2080s, significantly up from 8.2 billion in 2024. After peaking, the global population is projected to start declining gradually, falling to 10.2 billion people by the end of the century. India, which surpassed <keyword id="19894886" type="General" weightage="20" keywordseo="China" source="keywords">China</keyword> as the world's most populous nation last year, will continue to hold that position through 2100. "The population of India, which is expected to remain the world's largest throughout the century, will likely decline by 12% after reaching its peak in the early 2060s at about 1.7 billion," the <keyword id="19898339" type="General" weightage="20" keywordseo="UN" source="keywords">UN</keyword> report published by the United Nations Department of Economic and Social Affairs (DESA), <keyword id="271075" type="General" weightage="20" keywordseo="population-division" source="Orion">Population Division</keyword> said. According to the report, India's population in 2024 is projected at 1.45 billion and this will peak to 1.69 billion in 2054. After this, India's population is projected to decline to 1.5 billion by the end of the century in 2100, but the country will still remain the most populous nation on Earth. Responding to a question by PTI on population projections for India, Senior Population Affairs Officer, Population Division, <keyword id="6355835" type="General" weightage="20" keywordseo="un" source="Orion">UN</keyword> DESA Clare Menozzi said at a press conference that "India is currently the largest country in the world in terms of population, and it is projected to stay so throughout the century. The population is currently estimated at 1.45 billion, and it's supposed to increase further to 1.69 billion. "It's supposed to peak around the 2060s in size and then it starts to slightly decline. So by the end of the century, India is projected to be around 1.5 billion, but will still the largest country in the world by a large margin." The report said that China's population, currently 1.41 billion in 2024, will fall to 1.21 billion in 2054 and further decline to 633 million by 2100. "It is anticipated that China, the country currently with the world's second-largest population, will likely experience the largest absolute population loss between 2024 and 2054 (204 million)," followed by <keyword id="6355311" type="General" weightage="20" keywordseo="Japan" source="Orion">Japan</keyword> (21 million) and <keyword id="6358826" type="General" weightage="20" keywordseo="Russia" source="Orion">Russia</keyword> (10 million). "Longer-range population projections are more uncertain" for China, it said. "However, due to its large size and sustained low level of fertility, China is also likely to record the largest population decline of any country through the end of the century (786 million people). By 2100, China is projected to have lost more than a half of its current population and to have returned to a population size comparable to that recorded in the late 1950s (50% probability)." Responding to a question on the significantly low population projection for China, Director of the Population Division at UN DESA John Wilmoth said that "it really relates to the level of fertility that's observed currently in China. The current number is right around one birth per woman on average over a lifetime." "Given that you need 2.1 births to maintain the current population without migration, if fertility levels remain at such a low level, even if they come up slightly, any fertility level if it's below two, or especially below 1.8 or below 1.5, you're really getting into low levels of fertility and it produces a long run decline that's quite significant. And that's true for China. It's true for some other countries in this analysis," Wilmoth said. Currently, nearly one-fifth of all countries and areas, including China, Italy, the Republic of Korea and Spain, are experiencing what is sometimes referred to as "ultra-low" fertility, with fewer than 1.4 live births per woman over a lifetime. The report added that the global fertility rate currently stands at 2.25 live births per woman, down from 3.31 births in 1990. "More than half of all countries and areas globally have fertility below the replacement level of 2.1 live births per woman. This is the level required for a population to maintain a constant size in the long run (without migration), with each generation being followed by another of roughly equal size," it said. Pakistan is projected to overtake the US as the third-largest country in the world, with a population of 389 million in 2054. Currently, the US is the third largest country in the world with a population of 345 million and in 2054, it will be the fourth largest with 384 million people. Pakistan will remain the third largest country in the world, with a population of 511 million people in 2100. The report said that the estimated likelihood that the world's population will peak within the current century is very high, with a probability of 80%, a major change in UN projections from a decade ago, when this probability was around 30%. The size of the world's population in 2100 is now expected to be 6%smaller - or about 700 million people fewer - than anticipated a decade ago. In about 126 countries and areas, the population is likely to continue growing through 2054, potentially reaching a peak later in the century or beyond 2100. This group includes several of the world's most populous countries: India, Indonesia, Nigeria, Pakistan and the United States of America. In 2023, the global number of deaths among children under age 5 fell below 5 million for the first time in recent history. However, 95% of such deaths took place in the 126 countries with populations that are still growing, including the Democratic Republic of the Congo, India, Nigeria and Pakistan. The report added that globally, life expectancy at birth reached 73.3 years in 2024, an increase of 8.4 years since 1995. Further reductions in mortality are projected to result in an average longevity of around 77.4 years globally in 2054. Since 2022, life expectancy has returned to levels observed before the emergence of the coronavirus disease in nearly all countries and areas. At the height of the COVID-19 pandemic during 2020 and 2021, global life expectancy at birth fell to 70.9 years, down from 72.6 in 2019. The report said that by 2080, persons aged 65 or older will outnumber children under 18. "By the late 2070s, the number of persons at ages 65 years and higher globally is projected to reach 2.2 billion, surpassing the number of children (under age 18). By the mid-2030s, it is projected that there will be 265 million persons aged 80 years or older, more than the number of infants (1 year of age or less)," it said.

India's population to peak in early 2060s to 1.7 billion before declining: UN

<div type="image" title="Data from RBI suggests that the outstanding amount on gold loans has swelled from Rs 85,009 crore in September 2022 to Rs 1,47,081 crore in September 2024." msid="115250619" hostid="261" sizebytes="118350" caption="&amp;lt;p&amp;gt;Data from RBI suggests that the outstanding amount on gold loans has swelled from Rs 85,009 crore in September 2022 to Rs 1,47,081 crore in September 2024.&amp;lt;/p&amp;gt;"></div> “Ye le beta, humare khaandani sone ke gehne. Ise girvi rakhva de, shayad kuch paise aa jaye ghar main.” How many times have we seen similar dialogues repeat itself in Bollywood films of the 70s and 80s—abject poverty and a frail-looking old mother pleading to her son to pawn the family’s heirloom <keyword id="18712" type="General" weightage="20" keywordseo="gold" source="Orion">gold</keyword> ornaments to a jeweller, all to get a few bucks? Well, if you’d ask that son in 2024, he’d rather hit the loan button on his <keyword id="19977340" type="General" weightage="20" keywordseo="demat" source="keywords">Demat</keyword> account than pawn his mother’s gold jewellery. Given how Indians are rapidly resorting to taking loans against their investments in shares and mutual funds, these might as well be a cherished family heirloom in today’s time. Fair warning though; it's not as if gold and loans against it are going down in India’s lending scene. It's very much the opposite, shining brighter than ever! The secured loan category is having its time in the spotlight, and people are certainly looking beyond land and property to get their hands on some extra monies! But what is funding the steep rise behind these loans? And are they as failsafe and secure as they’re made out to be? We decode for you in this week’s Simply Put. <h2>The great Indian pawning party</h2>Pawning one’s gold has been, by far, the OG Indian financial move to get a loan. That continues well into 2024, and apparently, more so when India decides to wed and celebrate! Data from <keyword id="19899808" type="General" weightage="20" keywordseo="rbi" source="keywords">RBI</keyword> suggests that the outstanding amount on gold loans has swelled from Rs 85,009 crore in September 2022 to Rs 1,47,081 crore in September 2024. It looks like Gold took the motto of rise and shine too seriously! Table 1: Growth in gold loans <table style="border-width: initial; border-style: none; table-layout: fixed; width: 468pt;" class="redcator-table-advance"></colgroup><tbody><tr><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">Year </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">Amount (In Rs crore) </td></tr><tr><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">September 2022 </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">85,009 </td></tr><tr><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">March 2023 </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">89,370 </td></tr><tr><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">September 2023 </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">97,426 </td></tr><tr><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">March 2024 </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">1,02,562 </td></tr><tr><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">September 2024 </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">1,47,081 </td></tr></tbody><tbody></tbody><tbody></tbody><tbody></tbody><tbody></tbody></table> Source: RBI data While the world continues to be riled up in multiple geopolitical crises in 2024, gold has been making merry of these tough times. Thus far this year, domestic gold prices have grown by 23%, outperforming benchmark indices like Nifty and Sensex by a mile, which have gone up by 9.85% and 8.86%, respectively. The growth in gold loan disbursal rates month on month this year could also put Nifty and Sensex’s growth to shame. In just September 2024, gold loans grew an astounding 51%, up from 40.9% in August, 30.5% in June, and just 14.8% in March. <h2>Hey, wait up for me, says <keyword id="23953567" type="General" weightage="20" keywordseo="las" source="keywords">LAS</keyword></h2>In lockstep with the elder, gold loan sibling, advances against shares and bonds have also been inching up since 2022. Data from RBI (Reserve Bank of India) notes that as of September 2022, the outstanding quantum of loans that were taken against shares (LAS) and bonds stood at Rs 7,397.94 crores. This inched up to Rs 7,764 crore in September 2023. Come 2024, and it looked like this was LAS’ time to shine. Loans swiftly skyrocketed, with outstanding loans in this category going up from Rs 8,492 crore in March 2022 to a staggering Rs 9,546 crore at the end of September 2024. Naturally, the smoke of LAS has its fire in the record inflows that Indians are pouring into the stock market and mutual funds month on month. Per AMFI (<keyword id="20090034" type="General" weightage="20" keywordseo="association-of-mutual-funds" source="keywords">Association of Mutual Funds</keyword> in India), the net AUM (assets under management) of India’s mutual fund industry grew to Rs 67,25,614.61 crores in October 2024, up from Rs 67,09,259.24 crores in September 2024. Even the number of retail mutual fund folios, which include equity, hybrid, and solution-oriented mutual funds, burgeoned to 17,23,52,296 in October, as compared to 16,81,61,366 in September. The same goes for stock investments in India, where the number of new demat accounts that are added every month just simply refuses to climb down. As of last month, total demat accounts in the country stood at 17.9 crore, which is more than the entire population of full-fledged nations like Japan (12.45 crore), Russia (14.38 crore), and Bangladesh (17.3 crore). In fact, since February this year, the monthly growth of LAS has been hitting double digits. From 11.3% in March to 21.6% in May to 26.8% in August, growth in LAS has been exceptional, hitting 22.9% in September this year. For context, monthly growth in the LAS segment was at a mere 5% in September 2023. <h2>What's driving the growth?</h2>It's a win-win for both the bank and the customer. Customers love them because LAS is available at a lower interest rate compared to unsecured personal loans. You can get a loan at an interest rate of anywhere between 9 and 12% by pledging your gold, MF units, or shares. Compare this to over 10-28% rates, which is the range where unsecured personal loans charge interest. Banks love <keyword id="827883" type="General" weightage="100" keywordseo="secured-loans" source="Orion">secured loans</keyword> since they are well-secured. In case you default on paying back, the bank can sell off your gold, shares, or mutual fund units to recover the amount. This takes a lot of stress off the banks, which are already dealing with secured loans’ riskier sibling-unsecured lending. High NPAs (non-performing assets) and non-payments in the unsecured borrowing space have already put RBI on red alert, which is why the apex bank is tightening the screws on unsecured lending, which was well on its way to becoming a ticking time bomb. As a result, credit growth has moderated to 12.8% YoY in October, as against the 19.3% rise recorded in the year-ago period. Yet it's not like the banks won't feel the heat. Analysts at Nomura note that personal loan delinquencies in India that have been overdue by over 90 days rose to 5.1% in the last financial year, as opposed to just 3.9% in the year prior. <h2>How does it work?</h2>Both these loans work on a similar principle: Your loan amount is equal to a certain percentage of the actual market value of your asset. This is known as the <keyword id="20051485" type="General" weightage="20" keywordseo="ltv" source="keywords">LTV</keyword> (loan-to-value ratio). In the case of gold and debt mutual funds, RBI mandates that this LTV be about 75-80%. So, for every Rs 100 of gold or debt mutual fund unit you pledge, your maximum loan amount cannot exceed Rs 80. If you pledge gold, which has a market value of Rs 10 lakh, you can take a loan of up to Rs 8,00,000. In the case of shares and mutual fund units, this limit is set at 50%. So, your shares worth Rs 5,00,000 can only get you a loan worth Rs 2,50,000. But the bright side? You can continue earning returns on your investments and pay interest only on the amount you use, since this loan works as an overdraft facility. <h2>Super safe, you say?</h2>Interest rates on both of these loans are very much dependent on the market value of the asset, which wildly fluctuates on a day-to-day basis. So, in case the value of your asset falls, you’ll have to keep a margin or more of the same asset in order to continue with the loan and maintain the LTV balance. Failure to do so could mean the bank can even sell off your asset. Says financial planner Nema Chaya Buch. “Yes, LAS offers easy availability of funds since these loans come with a lower interest rate as compared to personal loans. Also, you continue to earn average returns of 10–13% on your equity investments. But the downside is, in case of emergency, those pledged securities cannot be sold. Also, if the equity market goes down, then the bank may ask for additional collateral. Raghvendra Nath, MD, Ladderup Wealth Management notes that taking a LAS is best when the value of your securities has appreciated significantly. “This allows you to maximize the loan amount based on your collateral while also addressing financial needs without having to liquidate your investment portfolio. However, there are notable disadvantages to consider. The market risk is significant; a substantial decline in market value could lead to margin calls, which may incur fees and charges if there are delays or prepayments, ultimately increasing the effective cost of borrowing. Furthermore, failure to make timely payments could result in the loss of your assets.”. Umesh Mohanan, ED &amp; CEO, of Indel Money, cautions that one should have a sufficient quantity of gold to get the loan amount one wants. "According to the current RBI rules, the loan applicant/borrower can draw up to 75% of the total market value of the collateral/gold jewellery. So, always carry a sufficient quantity of gold based on one’s loan requirement. “The most important thing is that the valuation of the gold depends on the purity of the gold. If the borrower pledges gold with higher purity, such as 24 carats or 22 carats, he will get the maximum loan amount," he adds.

Simply Put: Secured Loans 2.0 — why more and more Indians are turning to gold, shares and mutual funds to get loans

“Ye le beta, humare khaandani sone ke gehne. Ise girvi rakhva de, shayad kuch paise aa jaye ghar main.” How many times have we seen similar dialogues repeat itself in Bollywood films of the 70s and 80s—abject poverty and a frail-looking old mother pleading to her son to pawn the family’s heirloom gold ornaments to a jeweller, all to get a few bucks? Well, if you’d ask that son in 2024, he’d rather hit the loan button on his <keyword id="105386" type="General" weightage="20" keywordseo="Demat-account" source="Orion">Demat account</keyword> than pawn his mother’s gold jewellery. Given how Indians are rapidly resorting to taking loans against their investments in shares and mutual funds, these might as well be a cherished family heirloom in today’s time. Fair warning though; it's not as if gold and loans against it are going down in India’s lending scene. It's very much the opposite, shining brighter than ever! The secured loan category is having its time in the spotlight, and people are certainly looking beyond land and property to get their hands on some extra monies! But what is funding the steep rise behind these loans? And are they as failsafe and secure as they’re made out to be? We decode for you in this week’s Simply Put. <h2 style="margin-bottom: 0.7em; line-height: 1.3; color: rgb(0, 0, 0); font-size: 24px; background: 0px 0px; text-rendering: optimizelegibility;">The great Indian pawning party</h2>Pawning one’s gold has been, by far, the OG Indian financial move to get a loan. That continues well into 2024, and apparently, more so when India decides to wed and celebrate! Data from <keyword id="30067" type="General" weightage="20" keywordseo="RBI" source="Orion">RBI</keyword> suggests that the outstanding amount on gold loans has swelled from Rs 85,009 crore in September 2022 to Rs 1,47,081 crore in September 2024. It looks like Gold took the motto of rise and shine too seriously! Table 1: Growth in gold loans <table class="redcator-table-advance" style="border-width: initial; border-style: none; background-color: rgb(255, 255, 255); font-size: 16px; line-height: 1.6em; box-shadow: none; width: 468pt; font-family: Merriweather; table-layout: fixed; padding-bottom: 10px !important; background-image: inherit !important; background-position: inherit !important; background-size: inherit !important; background-repeat: inherit !important; background-attachment: inherit !important; background-origin: inherit !important; background-clip: inherit !important;"></colgroup><tbody><tr><td style="border-width: 1pt; border-style: solid; border-color: rgb(0, 0, 0); padding: 5pt; font-size: 16px; vertical-align: top; overflow: hidden; overflow-wrap: break-word;">Year </td><td style="border-width: 1pt; border-style: solid; border-color: rgb(0, 0, 0); padding: 5pt; font-size: 16px; vertical-align: top; overflow: hidden; overflow-wrap: break-word;">Amount (In Rs crore) </td></tr><tr><td style="border-width: 1pt; border-style: solid; border-color: rgb(0, 0, 0); padding: 5pt; font-size: 16px; vertical-align: top; overflow: hidden; overflow-wrap: break-word;">September 2022 </td><td style="border-width: 1pt; border-style: solid; border-color: rgb(0, 0, 0); padding: 5pt; font-size: 16px; vertical-align: top; overflow: hidden; overflow-wrap: break-word;">85,009 </td></tr><tr><td style="border-width: 1pt; border-style: solid; border-color: rgb(0, 0, 0); padding: 5pt; font-size: 16px; vertical-align: top; overflow: hidden; overflow-wrap: break-word;">March 2023 </td><td style="border-width: 1pt; border-style: solid; border-color: rgb(0, 0, 0); padding: 5pt; font-size: 16px; vertical-align: top; overflow: hidden; overflow-wrap: break-word;">89,370 </td></tr><tr><td style="border-width: 1pt; border-style: solid; border-color: rgb(0, 0, 0); padding: 5pt; font-size: 16px; vertical-align: top; overflow: hidden; overflow-wrap: break-word;">September 2023 </td><td style="border-width: 1pt; border-style: solid; border-color: rgb(0, 0, 0); padding: 5pt; font-size: 16px; vertical-align: top; overflow: hidden; overflow-wrap: break-word;">97,426 </td></tr><tr><td style="border-width: 1pt; border-style: solid; border-color: rgb(0, 0, 0); padding: 5pt; font-size: 16px; vertical-align: top; overflow: hidden; overflow-wrap: break-word;">March 2024 </td><td style="border-width: 1pt; border-style: solid; border-color: rgb(0, 0, 0); padding: 5pt; font-size: 16px; vertical-align: top; overflow: hidden; overflow-wrap: break-word;">1,02,562 </td></tr><tr><td style="border-width: 1pt; border-style: solid; border-color: rgb(0, 0, 0); padding: 5pt; font-size: 16px; vertical-align: top; overflow: hidden; overflow-wrap: break-word;">September 2024 </td><td style="border-width: 1pt; border-style: solid; border-color: rgb(0, 0, 0); padding: 5pt; font-size: 16px; vertical-align: top; overflow: hidden; overflow-wrap: break-word;">1,47,081 </td></tr></tbody><tbody></tbody><tbody></tbody><tbody></tbody><tbody></tbody><tbody></tbody><tbody></tbody></table> Source: RBI data While the world continues to be riled up in multiple geopolitical crises in 2024, gold has been making merry of these tough times. Thus far this year, <keyword id="3886593" type="General" weightage="20" keywordseo="domestic-gold" source="Orion">domestic gold</keyword> prices have grown by 23%, outperforming benchmark indices like Nifty and Sensex by a mile, which have gone up by 9.85% and 8.86%, respectively. The growth in gold loan disbursal rates month on month this year could also put Nifty and Sensex’s growth to shame. In just September 2024, gold loans grew an astounding 51%, up from 40.9% in August, 30.5% in June, and just 14.8% in March. <h2 style="margin-bottom: 0.7em; line-height: 1.3; color: rgb(0, 0, 0); font-size: 24px; background: 0px 0px; text-rendering: optimizelegibility;">Hey, wait up for me, says LAS</h2>In lockstep with the elder, gold loan sibling, advances against shares and bonds have also been inching up since 2022. Data from RBI (Reserve Bank of India) notes that as of September 2022, the outstanding quantum of loans that were taken against shares (LAS) and bonds stood at Rs 7,397.94 crores. This inched up to Rs 7,764 crore in September 2023. Come 2024, and it looked like this was LAS’ time to shine. Loans swiftly skyrocketed, with outstanding loans in this category going up from Rs 8,492 crore in March 2022 to a staggering Rs 9,546 crore at the end of September 2024. Naturally, the smoke of LAS has its fire in the record inflows that Indians are pouring into the stock market and mutual funds month on month. Per AMFI (<keyword id="134904" type="General" weightage="20" keywordseo="Association-of-Mutual-Funds-in-India" source="Orion">Association of Mutual Funds in India</keyword>), the net AUM (assets under management) of India’s mutual fund industry grew to Rs 67,25,614.61 crores in October 2024, up from Rs 67,09,259.24 crores in September 2024. Even the number of retail mutual fund folios, which include equity, hybrid, and solution-oriented mutual funds, burgeoned to 17,23,52,296 in October, as compared to 16,81,61,366 in September. The same goes for stock investments in India, where the number of new demat accounts that are added every month just simply refuses to climb down. As of last month, total demat accounts in the country stood at 17.9 crore, which is more than the entire population of full-fledged nations like Japan (12.45 crore), Russia (14.38 crore), and Bangladesh (17.3 crore). In fact, since February this year, the monthly growth of LAS has been hitting double digits. From 11.3% in March to 21.6% in May to 26.8% in August, growth in LAS has been exceptional, hitting 22.9% in September this year. For context, monthly growth in the LAS segment was at a mere 5% in September 2023. <h2 style="margin-bottom: 0.7em; line-height: 1.3; color: rgb(0, 0, 0); font-size: 24px; background: 0px 0px; text-rendering: optimizelegibility;">What's driving the growth?</h2>It's a win-win for both the bank and the customer. Customers love them because LAS is available at a lower interest rate compared to unsecured personal loans. You can get a loan at an interest rate of anywhere between 9 and 12% by pledging your gold, MF units, or shares. Compare this to over 10-28% rates, which is the range where unsecured personal loans charge interest. Banks love <keyword id="827883" type="General" weightage="100" keywordseo="Secured-Loans" source="Orion">secured loans</keyword> since they are well-secured. In case you default on paying back, the bank can sell off your gold, shares, or mutual fund units to recover the amount. This takes a lot of stress off the banks, which are already dealing with secured loans’ riskier sibling-<keyword id="947940" type="General" weightage="20" keywordseo="unsecured-lending" source="Orion">unsecured lending</keyword>. High NPAs (non-performing assets) and non-payments in the unsecured borrowing space have already put RBI on red alert, which is why the apex bank is tightening the screws on unsecured lending, which was well on its way to becoming a ticking time bomb. As a result, credit growth has moderated to 12.8% YoY in October, as against the 19.3% rise recorded in the year-ago period. Yet it's not like the banks won't feel the heat. Analysts at Nomura note that <keyword id="23954457" type="General" weightage="20" keywordseo="personal-loan-delinquencies" source="Orion">personal loan delinquencies</keyword> in India that have been overdue by over 90 days rose to 5.1% in the last financial year, as opposed to just 3.9% in the year prior. <h2 style="margin-bottom: 0.7em; line-height: 1.3; color: rgb(0, 0, 0); font-size: 24px; background: 0px 0px; text-rendering: optimizelegibility;">How does it work?</h2>Both these loans work on a similar principle: Your <keyword id="857141" type="General" weightage="20" keywordseo="loan-amount" source="Orion">loan amount</keyword> is equal to a certain percentage of the actual market value of your asset. This is known as the LTV (loan-to-value ratio). In the case of gold and debt mutual funds, RBI mandates that this LTV be about 75-80%. So, for every Rs 100 of gold or debt mutual fund unit you pledge, your maximum loan amount cannot exceed Rs 80. If you pledge gold, which has a market value of Rs 10 lakh, you can take a loan of up to Rs 8,00,000. In the case of shares and mutual fund units, this limit is set at 50%. So, your shares worth Rs 5,00,000 can only get you a loan worth Rs 2,50,000. But the bright side? You can continue earning returns on your investments and pay interest only on the amount you use, since this loan works as an overdraft facility. <h2 style="margin-bottom: 0.7em; line-height: 1.3; color: rgb(0, 0, 0); font-size: 24px; background: 0px 0px; text-rendering: optimizelegibility;">Super safe, you say?</h2>Interest rates on both of these loans are very much dependent on the market value of the asset, which wildly fluctuates on a day-to-day basis. So, in case the value of your asset falls, you’ll have to keep a margin or more of the same asset in order to continue with the loan and maintain the LTV balance. Failure to do so could mean the bank can even sell off your asset. Says financial planner Nema Chaya Buch. “Yes, LAS offers easy availability of funds since these loans come with a lower interest rate as compared to personal loans. Also, you continue to earn average returns of 10–13% on your equity investments. But the downside is, in case of emergency, those pledged securities cannot be sold. Also, if the equity market goes down, then the bank may ask for additional collateral. Raghvendra Nath, MD, Ladderup Wealth Management notes that taking a LAS is best when the value of your securities has appreciated significantly. “This allows you to maximize the loan amount based on your collateral while also addressing financial needs without having to liquidate your investment portfolio. However, there are notable disadvantages to consider. The market risk is significant; a substantial decline in market value could lead to margin calls, which may incur fees and charges if there are delays or prepayments, ultimately increasing the effective cost of borrowing. Furthermore, failure to make timely payments could result in the loss of your assets.”. Umesh Mohanan, ED &amp; CEO, of Indel Money, cautions that one should have a sufficient quantity of gold to get the loan amount one wants. "According to the current RBI rules, the loan applicant/borrower can draw up to 75% of the total market value of the collateral/gold jewellery. So, always carry a sufficient quantity of gold based on one’s loan requirement. “The most important thing is that the valuation of the gold depends on the purity of the gold. If the borrower pledges gold with higher purity, such as 24 carats or 22 carats, he will get the maximum loan amount," he adds.

Secured Loans 2.0 — why more and more Indians are turning to gold, shares and mutual funds to get loans

<div type="image" title="Are Indians depositing less money in banks, or more in mutual funds? Turns out, it&amp;#39;s neither of those." msid="113663806" hostid="261" sizebytes="1121785"></div> Over the past few months, there’s been a lot of brouhaha about the lagging pace of <keyword id="20202062" type="General" weightage="20" keywordseo="bank-deposits" source="keywords">bank deposits</keyword> in India. Simply put, the rate at which Indians are depositing their hard-earned money in banks has been falling constantly, and some blame the increasing financialisation of <keyword id="20751315" type="General" weightage="20" keywordseo="household-savings" source="keywords">household savings</keyword> in the country or the rising preference of Indians towards <keyword id="19929240" type="General" weightage="20" keywordseo="mutual-funds" source="keywords">mutual funds</keyword> and shares. So, the hypothesis is that people are choosing to invest more in mutual funds and the Indian <keyword id="19949641" type="General" weightage="20" keywordseo="equity-markets" source="keywords">equity markets</keyword> through direct investments, IPOs, or NFOs, the money flowing into Indian banks in the form of deposits is slowing down. But is that really the case? <h2>A crisis or a phase?</h2><keyword id="19899808" type="General" weightage="20" keywordseo="RBI" source="keywords" meta.keywordsubtype="org" meta.entityname="RBI" meta.hostid="261" meta.entityid="RBI">RBI</keyword> data suggested that for the quarter ended June 2024, bank deposits grew at 11.7%. On the other hand, credit growth has outpaced this at 15%. This means that the outflow from banks as loans is far greater than the inflow into them in the form of deposits in Q1 of FY 2024-25. The situation largely saw cut-copy-paste in the first week of September as well, with loans registering a 13.3% YoY growth during the period, while deposits rose only 11.1%. This gap has only been widening for the last 3 years. Since deposits are how banks gather assets to further lend and earn interest income as a consequence, even a slight dip could set the alarm bells ringing for banks, and rightfully so. And truth be told, mutual funds are indeed taking on bank deposits in a big way. Per a report by Franklin Templeton, in August 2024, the AUM (assets under management) of Indian mutual funds, or the total funds managed by them, stood at 31.3% of total bank deposits in the country, up from 24.20% during the year-ago period. As of August 2024, the AUM of mutual funds stood at Rs 66.17 lakh crore, an all-time high. But all said and done, is this really the reason why the rate of bank deposits is falling behind? SBI has dismissed this to be a “statistical myth”, and experts point out that since equity and fund houses also keep the cash in their respective bank accounts, there’s no cause for concern. So, is financialization really to be blamed for the trailing tempo of deposits? Or is something else happening behind the scenes? We take a closer look: <h2>First, are household deposits really slowing down? And is that a cause of concern?</h2>Data from Motilal Oswal suggests the contrary. Deposits grew by around 10.4% between March 2020 and August 2024. Data from RBI also highlights that as of August 9, 2024, bank deposits witnessed a YoY growth of 10.8%. The loan-to-deposit ratio for the retail segment, which indicates what percentage of its total deposits the banks lend out as loans, has stayed at 77.5%, above the 77% mark for the tenth straight month. <div type="image" title="Yes, household deposits (as % of total deposits) have dipped, but the drop is far from significant" msid="113663882" hostid="261" sizebytes="306706"></div> Also, we can’t forego the fact that the share of Indian households in bank deposits has indeed slowed down. However, data from Axis AMC shows that the dip is marginal—from 63% in 2022 to 62% in 2023 and 61% in 2024. What has slowed down even more considerably is the share of government deposits in the aggregate bank deposits, which has dipped from 14% in 2018 to 9% in 2024. So, it's not just household deposits, you see. Moreover, as of March 2024, the collective CASA ratio (current and <keyword id="114757" type="General" weightage="20" keywordseo="savings-account" source="Orion">savings account</keyword> deposits) of all commercial banks in India stood at 41.00%, down from 43.1% in March 2023 and 45.2% in March 2022, marking a nearly 5% point decline over the past year, while still staying over the 10-year average of 39.2%. This implies that Indian banks are relying more on higher-cost funds (savings accounts), which can limit their profitability. <h2>What is this financialisation of savings we are talking about?</h2>Then again, there is no doubt about the growing affinity of Indians towards mutual funds and stock markets. Recent data from CBDT (Central Board of Direct Taxes) highlights that India’s net direct tax collection surged by around 22%, driven exclusively by the significant uptick in the collection of Securities Transaction Tax (STT), which doubled to Rs 26,154 crore, from Rs 13,352 crore in the year-ago period. Why does this matter? STT is levied when you buy or sell equity shares on stock exchanges, sell <keyword id="6361918" type="General" weightage="20" keywordseo="equity-mutual-funds" source="Orion">equity mutual funds</keyword>, and trade in futures and options in the equity segment. Such taxes, including the multiple other taxes in equity market investments, are considered as leakages as the money moves out of the economy into government coffers. Data from a ValueQuest report explains that over the last 20 years, the markets have handsomely rewarded the investors, generating over $900 billion in incremental value for them. This is the major driver behind the dramatic rise in investment flowing towards the equity markets. There’s further proof of this budding romance, if you check the demat pudding. The number of demat accounts, which are a primary requisite for participating in the stock markets, also burgeoned by 42.3 lakh in August 2024, taking India’s total tally of demat accounts beyond 17 crore. To put this in perspective, this is almost equivalent to the population of just 8 nations in the world, including China, the US, Brazil and more. Vivek Iyer, Partner, Grant Thornton Bharat thinks it's rather important, as well. “Financialisation of household savings in India is an indication of deepening capital markets in the market, especially from a retail investor standpoint. Bank deposits with a modest rate of return are no longer the only option for savings for investors. Investors today have more avenues for wealth creation in the form of public capital markets, which have democratized wealth creation and provided equality of opportunity to retail investors”, he says. Yes, Indians are investing more and more in the markets, and in mutual funds. But is it a sin to look out for inflation-beating returns, which the stock markets offer, and vanilla bank deposits don't? After all, the allure of 12-13% annual returns offered by <keyword id="45369" type="General" weightage="20" keywordseo="equities" source="Orion">equities</keyword> can certainly pale the stability offered by good old deposits, which generally do not go beyond 9% when it comes to annual returns. But all of this is not what is behind the slowdown. India is still a toddler in the school of savings financialization, with less than 10% of the population holding a demat account, and less than 5% of us saving in equities. That's a drop in the ocean of deposits, far inadequate to trigger a tsunami. <h2>Tell me why lagging deposits have nothing to do with Indians investing more in mutual funds!</h2>Says Shweta Rajani, Head - Mutual Funds, Anand Rathi Wealth Limited, “Households' equity holdings composition grew from 11.1% in FY 23 to 14.7% in FY 24. This trend reflects a growing awareness of investment options, empowering individuals to take control of their financial futures. Despite this transition towards equities, banks still hold a significant share of household financial savings—33.5% in FY24 compared to 34.9% in FY23”. Also, household savings and their subsequent financialization do not have much to do with deposit creation, which is entirely made by banks. What actually drives increased deposits is credit growth or increased lending. When interest rates are eased, people tend to borrow more and spend more, which circulates more money in the economy. For the past 4 years, RBI has been tightening the screws on interest rates, which raises the cost of borrowings, and makes it more expensive to take loans, putting a dampener on credit growth, but effectively curbing inflationary pressures. The last time RBI cut the repo rate by 40 basis points was back in May 2020, 4 years ago. The lag in <keyword id="19998084" type="General" weightage="100" keywordseo="deposit-growth" source="keywords">deposit growth</keyword> we’re witnessing is almost 3 years old. Coincidence much, or just good old economics at work? But with the Fed recently setting a rate cut precedent by slashing 50 bps off its interest rate, RBI is expected to follow suit in the next MPC (Monetary Policy Committee) meeting, scheduled for November 2024. A rate cut would ease the aforementioned high cost of borrowing, and increase loan-taking for corporates and institutional investors, thereby stoking consumption in the economy. And then, deposit creation in banks is likely to return to its former glory. If not, then that would be a curious case to unravel! But that worry is for another day. Do you have insights or personal experience to share on your personal finances or money? Contact us at <a target="_blank" class="c-link" href="mailto:businessinsider@timesinternet.in">businessinsider@timesinternet.in</a>.

Simply Put: A Deposit Dilemma — What's the fuss about a crisis in Indian bank deposits? Are mutual fund investments to blame?

<ul class="summary-list"><li>The global population is getting older. </li><li>The trend will lead to lower returns, earnings growth, and valuations, JPMorgan strategists say.</li></ul>The aging of the world population is expected to accelerate in the coming decades, which will likely produce bad outcomes for the stock market, JPMorgan strategists say.The strategists say that historically, an older population has led to declining returns, lower earnings growth, and weaker valuations.Over a 10-year period, a 1% increase in the number of people over 65 is correlated with a 0.92% decline in annual stock returns, the strategists calculated in a report released last week.They point mainly to slower growth and falling valuations.With an older investor base looking to save for retirement, investment capital declines, leading to less innovation. That, plus slower growth in the workforce, will have a negative impact on earnings growth, the strategists say."Domestic population aging may reduce earnings growth for several reasons. It leads to slower workforce growth, reducing domestic economic growth. There is also evidence that aging can reduce innovation and productivity growth," the strategists said.That's especially true for companies that derive revenue from international operations, the strategists say."For companies that derive more of their revenue from abroad, like multinationals, global population aging (in a GDP-weighted sense) is likely to be more consequential for earnings growth than local population aging," the strategists wrote.That means equity market indexes with small and mid-caps will likely see more impact from local population aging than those with exclusively large caps.Valuations will also take a hit, the strategists said. As the elderly empty their retirement funds, national savings decline, thus raising bond yields. Older populations also pull out of the market at higher rates, driving down stock prices.Those trends, plus lower earnings growth expectations, justify lower valuations, the strategists say.The strategists say there's one bright spot, though. That's healthcare, which older populations tend to spend more on."We find a clear positive relationship between aging and excess returns on the sector, driven entirely by faster earnings growth," the strategists said.A 1% increase in the population share of those over 65 will lead to a 0.85% increase in health care returns over a 10-year period, the strategists say.The strategists note, too, that the populating aging trend won't impact countries equally. In China, the elderly share of the population is set to increase by seven percentage points in the next decade. The US, meanwhile, will see a more moderate rise from 18.1% to 21.5%.Past reports have also warned of the aging population's impact on the economy.Earlier this year, Barclays economist Jonathan Millar said boomers, a historically large generation, are approaching <a target="_blank" class="" href="https://www.businessinsider.com/baby-boomer-gen-z-millennials-economy-housing-job-market-stocks-2024-2">"peak burden" on the US economy</a> in the next few years. Meanwhile, <a target="_blank" class="" href="https://markets.businessinsider.com/news/stocks/recession-economy-outlook-us-stock-market-ownership-old-americans-retirement-2024-1">a larger share of people over 55% owning stocks</a> in the US may be a downside risk to the market, as older investors often don't have the luxury of holding through a downturn and could exacerbate volatility by selling during market pullbacks.

The world population is growing older. That's bad news for the stock market.

Grace, a 29-year-old publicist in New York, has regularly used a slew of dating apps for more than four years, with little luck. Despite endless chatting, her matches rarely materialize into in-person dates. She's tried a paid version of <a target="_blank" class="" href="https://www.businessinsider.com/hinge-boyfriend-why-dating-is-better-offline-2023-6">Hinge</a> ($100 for three months). She's tried the members-only app Raya, but after she spent $120 a year for the past three years, it's led her to only two first dates. At this point, Grace said, the apps have left her "burned out and exhausted."In a recent Forbes survey of Americans who'd used dating apps in the past year, 78% of respondents said they felt some amount of burnout. A growing number of younger people are rejecting dating and sex altogether. Among millions, a consensus is forming: <a target="_blank" class="" href="https://www.businessinsider.com/forever-alone-staying-single-done-with-dating-apps-2023-7">Dating apps suck</a> so bad that they might even be deliberately keeping us from finding love.Theories abound on what's behind the frustrating, sorry state of apps. Some point to how, as a way to compensate for stagnating user bases, many apps are increasingly becoming pay to play. Last fall, Tinder rolled out a <a target="_blank" class="" href="https://www.businessinsider.com/how-to-get-tinder-select-the-499-monthly-subscription-2023-12">$500 monthly subscription</a>, in addition to two cheaper membership tiers. The League charges up to $1,000 a week or $2,500 a month. Hinge charges users for "roses" to send to their "standouts," which are trapped behind a paywall that critics have dubbed "rose jail." These days, "it's really a lot harder to be functional if you're not on some level of a paid membership," Damona Hoffman, a dating coach, said. While apps like Hinge insist they're "designed to be deleted," finding a partner on them increasingly seems reserved only for those who can afford it.Some point to a fundamental misalignment between dating-app companies and their customers: The more successful the product is for the user, the worse it is for the bottom line. "They don't actually want you to be successful because that means they're losing a customer," said Bianca Stelian, a digital strategist who posted <a target="_blank" href="https://www.businessinsider.com/dating-apps-deleted-hinge-raya-tinder-bumble-oversaturated-bad-matches-2024-1">a viral TikTok</a> positing her own theories about dating-app burnout. Others argue that the apps are intentionally gamified and addictive. The average American dating-app user spends <a target="_blank" href="https://www.forbes.com/health/dating/dating-app-fatigue/">51 minutes a day</a> swiping, more than double the time the average American spends exercising. Ryan Clarkson, a lawyer who recently brought a class-action lawsuit on behalf of Tinder and Hinge users, compared dating apps maximizing user engagement and "trapping users in a perpetual pay-to-play loop" to pharmaceutical companies selling addictive drugs to vulnerable patients. Match Group, which owns Tinder and Hinge, called Clarkson's lawsuit "ridiculous" and insisted that its business strategy didn't rely on advertising or engagement metrics.Still, others blame the problem on the near monopoly a handful of companies — namely Match Group (which owns 45 dating brands worldwide) and Bumble — have on the market, which has led to years of complacency. "They've just been the same for so long," Ali Jackson, a New York City dating coach, said. "Somebody needs to do something drastically different."So here's one idea: What if your local government played matchmaker?Before you barf at the thought of your mayor setting you up on your next date, hear me out: The more expensive dating becomes, the less equitable it becomes. Meanwhile, the US government is increasingly recognizing social connection as a key element of public health, and increasingly investing in ways to combat our "<a target="_blank" href="https://www.businessinsider.com/there-is-no-loneliness-epidemic-mental-health-2024-4">loneliness epidemic</a>." If romantic relationships are so important both for the individual and for society, it's not a stretch to consider them a public good worth investing in.Some countries, including Japan and Australia, already do and have been experimenting with government-subsidized and even government-run alternatives to traditional, commercial dating apps. While these projects are still in their early days, they raise a once unthinkable, now compelling question for America: Could the government bring some much-needed innovation to dating?For years, several East Asian countries have desperately sought to reverse their plummeting birth rates. They've rolled out subsidies for parents, salary increases for younger workers, and other family-friendly policies. Increasingly, they see the dating industry as a lever to pull.The Japanese federal government's Children and Families Agency, for example, has set up marriage support centers in most of the country's 47 prefectures, providing services like dating coaches, in-person mixers, and at least one mixer in the metaverse. A center in Saitama prefecture (population 7.3 million) reported that since its center opened in October 2018, 12,517 couples had begun dating through the service and 472 couples had gotten married.In Tokyo, the city government is even releasing its own dating app, part of a campaign called Tokyo Futari Story ("futari" means couple). The service, which the city has budgeted several million dollars to develop and promote, will require users to verify their income, prove they're unmarried, sit for an interview with the app's staff, and sign a statement saying they're intent on getting married. Some experts are cautiously optimistic about the government playing cupid. Bouke de Vries, an associate professor of philosophy at Ghent University in Belgium who's studied dating apps, argues that state-run dating apps are at least in theory better positioned to help people find partners without spending too much money or time in the process. Many for-profit dating services are "gratuitously prolonging" users' search for love, he said. "The interests of governments are much better aligned with those of love-seeking users than those of private companies and love-seeking users," de Vries said.Others say these projects will do little to change entrenched attitudes. Omar Minami, a former Tinder employee in Japan and cofounder of a Japanese dating app, said that low marriage and birth rates are the result of much-deeper economic and cultural issues, including the gender wage gap, intense work culture, and huge expenses of raising kids. Government-funded dating apps are a "shiny object" and short-term solution, he added."It will take decades of work in order to change the mindset of Japanese people in regards to marriage," he said. "Unfortunately, government officials are only looking for investments that will pay off in their lifetime."On the other hand, governments can be given so much power to play matchmaker they damage all of society. In the 1980s, Singapore pursued a racist, eugenics-based policy by offering discounted dating services exclusively to college-educated citizens, who were disproportionately ethnically Chinese, excluding members of marginalized minorities. The government also funded voluntary sterilization for lower-income parents.Other countries, however, have stepped in to make dating less dangerous for its most vulnerable citizens. People with disabilities in Australia can now use the cash benefits they get from the country's <a target="_blank" href="https://www.ndis.gov.au/">National Disability Insurance Scheme</a> to pay for a dating app designed for people with disabilities, called the Cliq Connection. Cheryl Drury, the app's founder, said many of her customers previously had trouble dating, fell prey to scams, or were sexually assaulted. "They're just being eaten up on mainstream dating apps because they're just so vulnerable through physical assault as well as scams," she said. But she doubts the government will offer direct support for her services anytime soon, given the persistent "taboo" surrounding sexuality, relationships, and disability.A more realistic model for America may be a public-private partnership model. Last year, Japan's most popular dating app, the Match Group-owned Pairs, began collaborating with several prefectures and cities. The governments have employed researchers to devise questionnaires for users and have hosted dating seminars and other events, and they're covering the costs of their constituents' memberships to the app. The company, which isn't taking direct government funding, says it hopes these partnerships will help alleviate the "worsening population decline in rural areas and the resulting low birth rate and unmarried population."Francesca Katayama met her husband on Pairs in Tokyo in 2021 (they now have 2-year-old twins). The 31-year-old said she's in favor of more government support for dating — especially for an app like Pairs, which has already catered to people seeking committed relationships — but blames the country's high cost of living and intense work culture for low marriage and birth rates.Junko Yamada, a psychology professor at Rissho University who has worked with Pairs, thinks governments have a key role to play in breaking down barriers in the world of romance. "Although romantic relationships are often perceived as an individual problem," Yamada said, "the problem is actually largely due to social structures." She blamed a decline in dating on workplace sexual harassment, an insular social scene, and concerns about safety and security. Yamada said that government-subsidized dating services could appeal particularly to those who are skeptical of private-sector apps by offering extra security and ensuring users are serious about finding romantic connection.But could any of this happen in America? As of today, an engineer hoping to build the next OKCupid from inside the Department of Health and Human Services would face some steep hurdles.For one thing, there's a lack of bipartisan support. Beyond defending reproductive rights, liberals and progressives have largely shied away from promoting courtship and family creation. Meanwhile, small-government conservatives are unlikely to pass a Make America Date Again bill. Although! Conservatives have long been <a target="_blank" href="https://www.businessinsider.com/republican-baby-bust-panic-wont-support-pro-family-policies-2021-4">fixated on boosting the birth rate</a>, and Elon Musk, who is now donating $45 million a month to a Trump super PAC and has long warned against "population collapse," trumpeted the announcement of Tokyo's dating app. "I'm glad the Japanese government recognizes the importance of this matter. If radical action isn't taken, Japan (and many other countries) will disappear!" he wrote on X.But perhaps a bigger impediment than political will is cultural taboo. "There's something almost salacious about finding love and dating," said Justin Garcia, a sex researcher and professor of gender studies at Indiana University. If society viewed sex and relationships as a health issue, there would already be government funding to study it and independent commissions to address it, he added. But Garcia, who runs the university's sexual-behavior research center, Kinsey Institute, has found it nearly impossible to get the government to fund research related to sex and romance unless it's specific to a very particular, marginalized group, like those suffering from epilepsy or Alzheimer's.Instead, academics have to partner with industry or philanthropic organizations. Garcia serves as a scientific advisor to Match Group, which funds some of his research. Meanwhile, his work is under attack by Republican lawmakers, who last year ended state funding for the Kinsey Institute, prompting the university's board of trustees to consider turning it into an independent nonprofit.To Garcia, funding research on romantic and sexual relationships is a no-brainer. "These are some of the most important relationships in our lives," he said. "They impact our psychological health. They impact our physical health. They impact our financial and economic prospects. They impact our family dynamics and future generations."When it comes to dating apps, he supports rigorous research on what's working and what's not. He sees a role for the government, though, he said, there's a vaguely ominous threat of the government intervening in people's personal lives. "We don't want government telling us who we should partner with, and how to partner, and when to partner, but rather giving people more resources to have successful relationships," he said.No American government has yet helped its constituents date. But it might not be hard to imagine a local official like Mayor Eric Adams of New York City — who once spun his outdoor-dining policy as a way to promote flirting — getting behind a state-supported dating service. One could hear him announcing at a press conference: "We are extremely proud to introduce a new dating experience from America's mayor, called Adams &amp; Eve."<a target="_blank" rel="" href="https://www.businessinsider.com/author/eliza-relman">Eliza Relman</a> is a policy correspondent focused on housing, transportation, and infrastructure on Insider's economy team.

Japan's one weird trick to reverse population collapse

<ul class="summary-list"><li>Bipartisan support is growing for a US sovereign wealth fund.</li><li>The Alaska Permanent Fund, which distributes money to Alaska residents annually, could be a model.</li></ul>Bipartisan momentum is building around a <a target="_blank" href="https://www.businessinsider.com/trump-and-biden-us-should-have-a-sovereign-wealth-fund-2024-9">sovereign wealth fund that could help the United States</a> reduce its national debt or fund ambitious projects.At the White House, President Joe Biden's top aides have circulated plans for a fund to finance national security interests. And former President Donald Trump recently called for a similar state-owned investment fund to finance "great national endeavors" during a campaign stop at the Economic Club of New York.It is unclear how an American fund would be funded or how it would operate. However, lawmakers might have something of a model in <a target="_blank" href="https://www.businessinsider.com/alaska-permanent-fund-basic-income">The Alaska Permanent Fund</a>, which distributes the money it makes to the state's residents as annual dividends."The fund was initially established with revenue from mineral extraction, primarily oil, but within a few years after its initiation, its primary source of revenue is investment returns," Sarah Cowan, executive director of the Cash Transfer Lab, previously told Business Insider. "It diversifies the Alaskan economy because, at this juncture, the revenue from this fund primarily does not come from oil."Alaska's fund offers benefits that mimic a universal basic income — a no-strings-attached, recurring payment distributed to people regardless of socioeconomic status. But there are some key differences. For one, the dividend doesn't come out of taxes; it's paid only annually and doesn't equate to a livable wage.Federal lawmakers likely see a sovereign wealth fund serving a different purpose, like supporting industries or financing supply chain initiatives. Creating one at the national level also comes with more legislative hurdles."Typically, many countries went through special law making to create a SWF, defining the SWF's source of capital, investment mandate, and supervision system," Winston Ma, an adjunct professor at NYU and the author of The Hunt for Unicorns: How Sovereign Funds Are Reshaping Investment in the Digital Economy, wrote to Business Insider by email. "Therefore, it's not a simple corporate setup. It will involve lots of collaborative work between the executive and legislative branches — after the election."Sovereign wealth funds — like Alaska's or Norway's Government Pension Fund Global, which is the largest in the world — are often funded by wealth generated from state-owned natural resources. The issue is that "natural resources in the US are mostly owned by the states," Ma said. So, consolidating those revenue streams might require some back and forth.

The US is considering a sovereign wealth fund. Alaska already has one, and it's funding a universal basic income.

<ul class="summary-list"><li>Malta, a small Mediterranean island that attracts <a target="_blank" href="https://www.businessinsider.com/sc/malta-safe-summer-travel-destination-europe-2021-7">wealthy tourists,</a> might be the next AI center.</li><li>It's using AI to automate tasks, improve education, and solve traffic issues.</li></ul>Silicon Valley isn't the only hotspot in the AI boom.Malta, a small island in the Mediterranean Sea, is leaning heavily into the technology. Its businesses, universities, and the government are embracing AI as a way to automate tasks, improve education, and even solve rush hour traffic jams.The country has a population of just over 500,000, but it already has 56 AI startups, according to startup tracker Tracxn Technologies. That's about 1 startup for every 9,500 people. Meanwhile, the United States, which has a population of over 330 million, has around 24,000 AI startups by Tracxn's count. Or 1 for about every 14,000 residents.The country has long made headlines as a <a target="_blank" href="https://www.businessinsider.com/sc/visit-malta-safely-this-holiday-season-2021-11">hot spot for wealthy tourists</a>. Its <a target="_blank" href="https://www.businessinsider.com/golden-visa-passport-malta-citizenship-by-investment-wealthy-americans-europe-2023-2">"golden passport,"</a> which gives rich foreigners citizenship in exchange for investing a certain amount of money in the country, was the second most sought-after foreign passport program for Americans last year.It also began pouring money into artificial intelligence before the ChatGPT-fueled AI arms race began.In 2019, Malta <a target="_blank" href="https://malta.ai/wp-content/uploads/2019/11/Malta_The_Ultimate_AI_Launchpad_vFinal.pdf">outlined a vision</a> to be the "Ultimate AI Launchpad" by 2030. The goal was for Malta to become "a place in which local and foreign companies and entrepreneurs can develop, prototype, test, and scale AI, and ultimately showcase the value of their innovations across an entire nation primed for adoption." AI would "springboard from Malta to the world."Those efforts stalled between the pandemic and a turn of the political administration. Now, under the <a target="_blank" href="https://www.businessinsider.com/european-union-trying-regulate-ai-artificial-intelligence-could-backfire-2024-3">EU's AI Act</a> — the region's sweeping AI legislation, which bans unacceptable use cases — Malta is working on a new AI strategy, <a target="_blank" href="https://www.bloomberg.com/news/articles/2024-05-24/a-tiny-mediterranean-island-wants-a-piece-of-the-global-ai-frenzy">Bloomberg reported</a>.Those at the center of this renewed effort are focused on safely deploying the technology. They're developing initiatives to combat job displacement and ethical frameworks, for instance."Foresight in recognizing the importance of AI has given Malta a head start in the field of AI, and it continues to be a leader in the industry today," Alexiei Dingli, a professor of artificial intelligence at the University of Malta, who's leading Malta's endeavors, including the traffic jam project, told Bloomberg.

This tiny island nation has more AI startups per capita than the United States

<ul class="summary-list"><li>Intel is looking for an investor to acquire a stake in its Altera subsidiary, CNBC reported.</li><li>The US tech giant is seeking a deal that values the programmable chip unit at around $17 billion.</li></ul>Tech giant Intel is seeking an investor for a stake in its Altera subsidiary, <a target="_blank" class="" href="https://www.cnbc.com/2024/10/18/intel-seeks-billions-for-minority-stake-in-altera-business-sources-say.html">CNBC reported late Thursday,</a> citing people familiar with the matter.Intel is seeking a deal that values Altera at around $17 billion, per CNBC. The US company is looking to raise several billion dollars for at least a minority stake in Altera, according to the network.Intel has told some investors this week that it would be possible to acquire a majority stake in Altera, according to CNBC.The news comes as US chip giant Intel faces <a target="_blank" class="" href="https://www.businessinsider.com/intel-qualcomm-takeover-bid-layoffs-foundry-spin-off-2024-9">troubles</a> just as Washington is seeking to revitalize the country's chip industry for national security reasons.In March, President Joe Biden announced Intel would receive $8.5 billion in funding from the CHIPS Act. In September, Biden awarded another $3 billion to the company.However, <a target="_blank" class="" href="https://www.businessinsider.com/intel-struggles-qualcomm-deal-chip-industry-turmoil-2024-9">Intel still faces business challenges</a> that include manufacturing delays and falling behind in the AI race. The company's <a target="_blank" class="" href="https://markets.businessinsider.com/stocks/intc-stock">stock price</a> is down 55% this year to date.The <a target="_blank" rel=" nofollow" class="" href="https://www.wsj.com/business/deals/qualcomm-approached-intel-about-a-takeover-in-recent-days-fa114f9d">Wall Street Journal reported</a> in September that its competitor <a target="_blank" rel="" class="" href="https://www.businessinsider.com/qualcomm-intel-acquisition-chips-semiconductors-tsmc-2024-9">Qualcomm had approached Intel</a> about a takeover deal.Last month, Intel CEO Pat Gelsinger mentioned in a <a target="_blank" class="" href="https://www.intc.com/news-events/press-releases/detail/1710/a-message-from-intel-ceo-pat-gelsinger-to-employees">message to employees</a> that the company was looking to sell part of its stake in Altera to "carefully manage our cash as we meaningfully improve our balance sheet and liquidity."The sale of part of Intel's stake in Altera "has long been part of our strategy to generate proceeds for Intel on Altera's path to an IPO," Gelsinger said in his message.Intel's search for an investor in Altera comes in a big week for semiconductor companies. Dutch equipment maker <a target="_blank" href="https://markets.businessinsider.com/news/stocks/chipmakers-tumble-asml-guidance-semiconductor-nvidia-chip-growth-2024-10">ASML</a> and Taiwanese chip giant <a target="_blank" href="https://www.businessinsider.com/tsmc-earnings-taiwan-semiconductor-chip-ai-chip-demand-asml-china-2024-10">TSMC</a> both reported quarterly earnings that showed <a target="_blank" class="" href="https://www.businessinsider.com/asml-tsmc-earnings-demand-ai-chips-2024-10">AI chip growth</a> in the short to medium term.Intel did not immediately respond to a request for comment from Business Insider sent outside regular business hours.

Intel is seeking an investor for a stake in its Altera chip unit, CNBC reports

<ul class="summary-list"><li>Quant giant D.E. Shaw has hired people from non-traditional finance backgrounds for decades.</li><li>The firm's head of recruiting told BI he looks for certain traits when hiring, including "learning agility."</li></ul>It was 2011, and Tim Willenken had just spent the past 12 years — four as an undergrad and eight in a doctoral program — preparing to be a philosophy professor.There was just one problem: He didn't want to be in academia anymore.He "had no idea where to start" looking for a job, knowing just about the professions he had been exposed to in graduate school — doctors, lawyers, and professors, he told Business Insider.To learn about what else was out there, he went through his Facebook friends list and called people working at companies in roles he hadn't heard of before. He eventually spoke to an old college friend he knew through debate club who had previously worked at D.E. Shaw."That was the first time I'd heard of the firm," said Willenken, a senior vice president in the D.E. Shaw's corporate development unit. "I think I'd had one conversation about what a hedge fund was when I applied." D.E. Shaw, started in 1988 by now-billionaire computer scientist David Shaw in New York, is remarkably secretive even for the guarded world of hedge funds, but what little has leaked paints the manager as being on the <a target="_blank" class="" href="https://www.businessinsider.com/first-half-quant-returns-from-de-shaw-two-sigma-renaissance-2024-7">cutting edge</a> of quant finance.While working at the $60 billion fund is now the goal for many finance-focused students at <a target="_blank" class="" href="https://www.businessinsider.com/de-shaws-summer-internship-recruitment-interview-tips-2023-4">top universities</a> and a destination for quants, the manager has also maintained its long history of hiring non-traditional talent. Early hires included crime fiction writer Charles Ardai and Amazon founder Jeff Bezos, and the manager now boasts on its website that employees come "by way of academia, Silicon Valley, or an NGO."Other hedge funds are also hoping to convince academics, technologists, and others to join their ranks instead of staying in their field or working in Big Tech as they grow and compete to have best-in-class talent rosters. These offers are not just down to compensation, which is handsome at hedge funds.The firm's head of recruiting, Jeremy Reff, a former English major at Harvard who has worked at the fund for nearly two decades, is in charge of continuing and improving on this tradition of non-traditional hires. While some who join D.E. Shaw may require additional training or a longer runway to get up to speed, he said, the return on these hires outstrips the costs."There are benefits to having a beginner's mindset," he said, and the firm's expansion into different investment strategy types, such as <a target="_blank" class="" href="https://www.prnewswire.com/news-releases/the-d-e-shaw-group-raises-combined-1-1-billion-for-two-new-funds-focused-on-private-market-opportunities-301746589.html">private investing</a> and discretionary global macro, can be attributed to the curious nature of these hires.  The reality, though, is that a lot of roles don't have exact equivalents to other parts of the industry, so people from outside finance are not on that much different footing as those with more traditional finance backgrounds, he said. "We are looking for traits and attributes more than one particular skill," he said.<h2 id="1ec22262-b503-4604-bafe-92fe9e0ecb78">Mentorship, prerequisites, and 'learning agility'</h2>While the firm is happy to invest ample time in training talented recruits, certain roles still require certain skills. For example, knowing how to program is a must if you're applying to be a <a target="_blank" class="" href="https://www.businessinsider.com/wall-street-top-technology-projects-goldman-blackstone-morgan-stanley-2024-8#d-e-shaw-s-generative-ai-approach-encourages-programmers-to-build-their-own-tools-4">software engineer</a>, Reff said.The firm's learning and development team is structured to get people up to speed on financial markets and where the firm sits within them. The rotational associates program lets new hires work for different teams in different roles so new employees can get a sense of where they fit best.The real learning happens on the job though."The only real way to learn is to get your hands dirty," Willenken said.Reff's job is to find people who can keep up. The interview process is designed to test potential at the firm, including creativity and "learning agility.""There are thousands of indicators for success that we use," he said. "No one is hired solely based on their résumé."   The firm used to consider <a target="_blank" class="" href="https://nymag.com/intelligencer/2019/09/david-e-shaw-college-donations.html">standardized test scores</a> as part of its hiring process but has phased them out over the last few years. "They aren't predictive of success," Reff said.The résumés are generally reviewed blindly, meaning names are not attached to the qualifications and experience.   The process has changed significantly since Reff was hired in 2006, two years after graduating from undergrad; he recalled speaking to his interviewer for a while about the Spanish novel "Don Quixote." Now, it's a more structured process, incorporating industry best practices with the firm's internal metrics and "secret sauce."  "We don't get it 100% correct, of course, and are always tinkering with it," he said.<h2 id="067dcf50-7ee4-431a-b455-7435b3922f71">Academics, doctors, and veterans</h2>The end result is that driven people find their place in the firm, one way or another. Ana Díaz Rivero, a quantitative researcher, "never had an interest in finance," but wanted to leave academia after getting her doctorate in physics.Her role allowed her to "continue pursuing academic research without being in academia," she said."A lot of the skills and tools we use are very similar. The principles behind how we do research are very similar," she said.For those who have joined the firm after working in a non-finance field, incorporating past abilities and skills into their current roles was a big selling point.For some, the biggest carryover from their former careers is habits they learned, like Lindsay Temes's military-trained punctuality and organizational skills. For others, like Dr. Omar Ali, a healthcare specialist on the fundamental equities team, there's more overlap.<div type="image" title="Lindsey Temes sits at a table, writing on a notepad" height="2667" width="4000" msid="114980202" hostid="261" sizebytes="1074078"></div>Temes, a vice president in the COO Group, spent more than a decade in the Air Force before leaving in 2018 to attend graduate programs at Harvard and MIT.As a Pat Tillman Foundation scholar, a program named for the late former football player-turned-soldier that covers veterans' education expenses, she was introduced to D.E. Shaw and found it was a place where she "would be valued and heard."  She overcame some initial hesitancy about financial services thanks to employees from non-traditional backgrounds who stressed that her role wasn't going to be "static."  A former doctor for the UK's National Health Service, Ali said that "the day-to-day is certainly different than working in medicine," but the jump to finance wasn't as daunting as it can seem from the outside.<div type="image" title="Dr. Omar Ali smiles while sitting in a conference room" height="1525" width="2000" msid="114980199" hostid="261" sizebytes="230880"></div>He said firms that focus on their employees' talents and not on fitting people into specific boxes make the transition easy."My real value is not my ability to navigate a balance sheet, it's my practical expertise in the field and my background," he said.<h2 id="900d026f-556a-4784-8b67-9629236daaba">Don't want to 'win' on compensation</h2>Hedge funds are known for paying their employees well, especially compared to fields like academia or government work.Job postings show positions such as a software developer making $200,000 a year, and a summer internship on the fundamental research team for college students is offering $18,000 a month in salary, plus overtime, along with a $10,000 signing bonus, a $10,000 housing allowance, and thousands of dollars in stipends for "self-study" materials and technology equipment.But Reff said, "I never want to win on solely compensation," and those who have joined from outside finance say they were drawn to the firm for a number of reasons beyond pay.Díaz Rivero and Ali knew of D.E. Shaw Research, a computational drug discovery company led by Shaw, which put the hedge fund on their radar. Willenken, the doctor of philosophy, appreciated that his role included the parts of academia he enjoyed most without the siloed approach academic research roles typically require.Timelines are tighter and there's more collaboration on the corporate development team, he said, and "the questions are a little more concrete than in philosophy." But he is using the same muscles to search for answers to questions that don't have easy answers.   "There's not a lot of low-hanging fruit. If there was an obvious answer, someone would have thought of it by now," he said.Reff has a shorthand he uses with potential recruits to describe the firm: "These are a bunch of people who really want to get things right."  "I think that's very attractive to people in a lot of different fields," he said.

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