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Financial Awareness for IBPS RRB PO & CLEKR MAINS 2021 Part 1: Financial & Banking Awareness (Static Part) Number of Chapter Topics Name

Chapter 1 RBI, Subsidiaries of RBI, NABARD, NHB, ECGC

Chapter 2 in , Exim , Payment Bank, Co-operative Banks, Regional Rural Banks, Small Finance Banks

Chapter 3 Banking Ombudsman, National Income

Chapter 4 Money Market, Capital Market

Chapter 5 Inflation

Chapter 6 Negotiable Instrument, Mutual Fund, Money Laundering

Chapter 7 Types of Cheque & Types of Account

Chapter 8 Types of Payment Cards, Fund transfer service

Chapter 9 Basel I, II and III

Chapter 10 NPA & SARFAESI Act, 2002

Chapter 11 LIBOR & MIBOR, SWIFT Codes for banks

Chapter 12 CIBIL, Priority Sector lending & Banks Merger

Chapter 13 Important Terms

Chapter 14 Micro, Small and Medium Enterprise in India

Chapter 15 (RRB)

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Part 2: Banking and Financial News PDF 2021 (Feb to August) Index No. of Topic Topic Name

Topic 1 List of Banks who has been imposed penalty by RBI in 2021

Topic 2 List of Banks whose licence has been canceled by RBI in 2021

Topic 3 Important Committee (Feb to July)

Topic 4 List of Merger and Acquisition (Covered Feb to July)

Topic 5 List of Partnership/Agreement (Covered Feb to July)

Topic 6 List of loan agreement for India from different organizations 2021

Topic 7 Union Budget 2021-22: Highlights

Topic 8 RBI Annual Report 2021

Topic 9 Banking & Financial News (Feb to July)

Topic 10 India’s GDP Growth Forecast FY 21 and 22 by various Financial Organizations (last Update 10 August 2021)

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Financial Market

Financial system Financial system a network of financial institutions (COMMERCIAL BANKS, BUILDING SOCIETIES, etc.) and markets (MONEY MARKET, STOCK MARKET), dealing in a variety of financial instruments BANK DEPOSITS, STOCKS and SHARES, etc.), which are engaged in money transmission activities and the provision of LOAN and CREDIT facilities. The financial institutions and markets occupy a key position in the economy as intermediaries in channelling savings and other funds to borrowers and investors. In doing this one of their main roles is to reconcile the different requirements of savers and borrowers, thereby facilitating a higher level of saving and investment in the economy than would otherwise be the case. Financial System

Insurance and Pension Regulators Central Banking Authority Capital Market Regulatory Authority

Central Bank (RBI) Capital Market (SEBI) Insurance and Pension Regulators (IRDA) 1)Monetary Control 1)Equity market and debt 1)Regulatory framework market supervision and including rules and 2)Supervision Over control

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Commercial Bank 2)Supervision over regulations for running insurance business Primary Dealers Stoke exchange 2)Supervising all Financial Institutions Brokers insurance companies both Cooperative Banks Equity and Debt raiser in general and life insurance business Clearing and Settlement Investment bankers System (Merchant Bankers) 3)Regulating pricing, investments and cost 3)Management of Foreign institutional structure of insurance Government debt investors companies 4) Banker to Government Custodians 4)Regulation insurance 5) Regulating monetary Depositories brokers including agencies instruments (CRR, SLR, both individual and Bank Mutual Funds BANK RATE, REPO RATE, PENSIONS MSF) Listed companies 1)Framing rules for Service providers to pension funds capital 2)Regulating all pension Markets like registrars funds

Chapter 1: RBI, Subsidiaries of RBI, NABARD, NHB, ECGC (RBI) History of RBI

• The Reserve Bank of India was established following the Reserve Bank of India Act of 1934. • Though privately owned initially, it was nationalised in 1949 and since then fully owned by (GoI). • It commenced its operations on 1 April 1935 in accordance with the Reserve Bank of India Act, 1934. • The Hilton-Young Commission, therefore ended by setting-up of a — called the Reserve Bank of India

Management

• One Governor (5years Term) • Four Deputy Governors (5years Term) • Fifteen Directors

Branches and support bodies

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• RBI Headquarters in Mumbai • The RBI has four zonal offices at Chennai, Delhi, Kolkata and Mumbai. • It has 21 regional offices and 11 sub-offices throughout India.

Functions of RBI

• The central bank of any country executes many functions such as overseeing monetary policy, issuing currency, managing foreign exchange, working as a bank for government and as a banker of scheduled commercial banks. It also works for overall economic growth of the country.

Subsidiaries of RBI Fully owned:

• Deposit Insurance and Credit Guarantee Corporation of India (DICGC), • Bharatiya Reserve Bank Note Mudran Private Limited (BRBNMPL) • Reserve Bank Information Technology Private Limited (ReBIT) • Indian Financial Technology and Allied Services (IFTAS)

Note: NABARD and NHB further. Both were the subsidiaries of RBI before 26 Feb 2019. About BRBNMPL

• Bharatiya Reserve Bank Note Mudran Private Limited • Prints banknotes for Reserve Bank of India (RBI) • Established in 1995 to address the demand for banknotes • It has two presses in Mysore and Salboni • Mysore -The machinery at Mysore Site has been supplied by Switzerland. • Salboni.- The machinery at Salboni has been supplied by Japan.

About DICGC

• DICGC (Deposit Insurance And Credit Guarantee Corporation ) • Established under the DICGC act 1961, on 15th July 1978 • All commercial bank including branches of a foreign bank in India, local area bank and RRB are insured by DICGC • NBFC and primary cooperative society are not insured by RBI • DICGC insures all types of account i.e. (Current, fixed, saving, recurring ) • The maximum amount insured by DICGC is 5 lakh

National Bank for Agriculture and Rural Development (NABARD) NABARD is a development bank focussing primarily on the rural sector of the country. It is the apex banking institution to provide finance for Agriculture and rural development.

• Headquartered- Mumbai • Chairman: Govinda Rajulu Chintala

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• NABARD was established on the recommendations of B.Sivaraman Committee, (by Act 61, 1981 of Parliament) on 12 July 1982 to implement the National Bank for Agriculture and Rural Development Act 1981. • The initial corpus of NABARD was Rs.100 crores. Consequent to the revision in the composition of share capital between Government of India and RBI, the paid up capital as on 31 May 2017, stood at Rs.6,700 crore with Government of India holding Rs.6,700 crore (100% share). The authorized share capital is Rs.30,000 crore

National Housing Bank (NHB)

• A Government of India owned entity • Founded: 9 July 1988 (under the Act, 1987) • Headquarters: New Delhi, India

Aims

• To promote a sound, healthy, viable and cost effective housing finance system to cater to all segments of the population and to integrate the housing finance system with the overall financial system. • To promote a network of dedicated housing finance institutions to adequately serve various regions and different income groups. • To augment resources for the sector and channelise them for housing. • To make housing credit more affordable.

ECGC (Export Credit Guarantee Corporation of India)

• Type: State-owned enterprise Public • Industry: Insurance • Founded: 30 July 1957 • Headquarters: Mumbai, • It was transformed into Export Credit and Guarantee Corporation Limited (ECGC) in 1964 and to Export Credit Guarantee Corporation of India in 1983.

Functions

• Provides a range of credit risk insurance covers to exporters against loss in export of goods and services as well. • Offers guarantees to banks and financial institutions to enable exporters to obtain better facilities from them. • Provides Overseas Investment Insurance to Indian companies investing in joint ventures abroad in the form of equity or loan and advances.

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Chapter 2: Banks in India Commercial Bank, Exim Bank of India, Payment Bank, Co-operative Banks, Regional Rural Banks, Small Finance Banks Commercial Bank Functions of Commercial Bank A commercial bank is a type of bank that provides services such as accepting deposits, making business loans, and offering basic investment products that is operated as a business for profit.

Public Sector Banks– These can be further classified into Nationalized Banks and Non Nationalized banks. These are the banks which are owned and controlled by the

Best Online Test Series Site for Bank | JAIIB | CAIIB | RRB NTPC | SSC and State Government 8 Jobs ambitiousbaba.com Online Test Series government. In these the majority of stake is held by the government. Their main aim is to provide service to the public. These include and its associates, , , , etc. Private Sector Banks– These are the banks which are owned and controlled by the private individuals. So their main aim is to earn profit like any other businessman does. These include ICICI Bank, HDFC Bank, , , etc Foreign Banks– These are the banks which are owned and controlled by the foreign companies. They have their headquarters in other countries and open their branches in India. Examples are Citi Bank, HSBC Ltd. Non-Scheduled Banks– The banks which are not included in the list of the scheduled banks are called the Non- Scheduled Banks. At present there are only 3 such banks in the country. Non- Scheduled Banks have to follow CRR conditions. These banks can have CRR fund with themselves as no compulsion has been made by the RBI to deposit it in the RBI. Non- Scheduled Banks are also not eligible for having loans from the RBI for day to day activities but under the emergency conditions RBI can grant loan to them. EXIM Bank Export–Import Bank of India is a finance institution in India, established in 1982 under Export-Import Bank of India Act 1981.

• On 23 September 2013, Committee on Comprehensive for Small Businesses and Low Income Households, headed by Nachiket Mor, was formed by the RBI. On 7 January 2014, the Nachiket Mor committee submitted its final report. Among its various recommendations, it recommended the formation of a new category of bank called payments bank. On 17 July 2014, the RBI released the draft guidelines for payment banks, seeking comments for interested entities and the general public. On 27 November, RBI released the final guidelines for payment banks. • In February 2015, RBI released the list of entities which had applied for a payments bank licence. There were 41 applicants. It was also announced that an external advisory committee (EAC) headed by Nachiket Mor would evaluate the licence applications. On 28 February 2015. • Payments banks is a new model of banks conceptualised by the Reserve Bank of India (RBI). These banks can accept a restricted deposit, which is currently limited to ₹100,000 per customer and may be increased further. These banks cannot issue loans and credit cards. Both current account and savings accounts can be operated by such banks. Payments banks can issue services like ATM cards, debit cards, net-banking and mobile-banking. Bharti Airtel set up India’s first live payments bank. • The RBI will grant full licenses under Section 22 of the Banking Regulation Act, 1949, after it is satisfied that the conditions have been fulfilled.

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• The minimum capital requirement is 100 crore. • Foreign share holding will be allowed in these banks as per the rules for FDI in private banks in India. • For the first five years, the stake of the promoter should remain at least 40%.

Cooperative banking

• is retail and commercial banking organized on a cooperative basis. Cooperative banking institutions take deposits and lend money in most parts of the world. Note: Co-operative banks have more than one head like the RBI, the Registrar of Co- operative Societies (RCS) and NABARD. They are established as public limited companies in the private sector under the Companies Act, 1956. They are governed by the provisions of Reserve Bank of India Act, 1934, Banking Regulation Act, 1949 and other relevant statutes.

Important Point

• Existing non-banking financial companies (NBFC), microfinance institutions (MFI) and local area banks (LAB) can apply to become small finance banks. • They can be promoted either by individuals, corporate, trusts or societies. • They are established as public limited companies in the private sector under the Companies Act, 1956. • They are governed by the provisions of Reserve Bank of India Act, 1934, Banking Regulation Act, 1949 and other relevant statutes. • The banks will not be restricted to any region. • They were set up with the twin objectives of providing an institutional mechanism for promoting rural and semi urban savings and for providing credit for viable economic activities in the local areas. • 75% of its net credits should be in priority sector lending and 50% of the loans in its portfolio must in ₹25 lakh (US$38,000) range. • The firms must have a capital of at least ₹100 crore (US$15 million). • The promoters should have 10 years’ experience in banking and finance. The promoters stake in the paid-up equity capital will be at least 40% initially but must be brought down to 26% in 12 years. Joint ventures are not permitted. Foreign share holding will be allowed in these banks as per the rules for FDI in private banks in India.

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• At net worth of ₹500 crore (US$77 million), listing will be mandatory within three years. Small finance banks having net worth of below ₹500 crore (US$77 million) could also get their shares listed voluntarily. • They can accept any deposit (savings, current, fixed deposits, recurring deposits) like commercial banks. • Unlike payment banks, small finance banks will be allowed to lend money also. • For the initial 3 years, prior approval will be required for branch expansion. • To give the feel of local bank, their area of operation will be restricted. • They are not allowed to lend the deposited money to big businesses or industries. Chapter 3: Banking Ombudsman, National Income

Banking Ombudsman Important Point

• The Banking Ombudsman Scheme was introduced under Section 35 A of the Banking Regulation Act, 1949 by RBI with effect from 1995. • The Banking Ombudsman Scheme was first introduced in India in 1995 and it was revised in 2002 • Current Banking Ombudsman Scheme introduced in 2006. • From 2002 until 2006, around 36,000 complaints have been dealt by the Banking Ombudsmen. • Banking Ombudsman is appointed by Reserve Bank of India. • There are 21 regional offices of Banking Ombudsmen in India. • Banking Ombudsman is a senior official appointed by RBI

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• All Scheduled Commercial Banks, Regional Rural Banks and Scheduled Primary Co-operative Banks are covered under the Banking Ombudsman Scheme.

Type of complaints resolved by banking ombudsman

• Non-payment or inordinate delay in the payment or collection of cheques, drafts, bills, etc.; • Non-acceptance, without sufficient cause, of small denomination notes tendered for any purpose, and for charging of commission for this service; • Non-acceptance, without sufficient cause, of coins tendered and for charging of commission for this service; • Non-payment or delay in payment of inward remittances ; • Failure to issue or delay in issue, of drafts, pay orders or bankers’ cheques; • Non-adherence to prescribed working hours; • Failure to honour guarantee or letter of credit commitments;

National Income

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Chapter 4: Money Market, Capital Market Financial markets

• Financial markets in every economy have two separate segments. • Short-term funds are for a period of 364 days (Money market). • Long term funds are for above 364 days (Capital Market).

Note : Chakravarthy committee (1985) for first time underlined the need of an organised money market and Vahul Committee (1987) laid the blueprint for that. Money Market Instruments of Money Market

• Treasury Bills • Commercial Paper • Commercial Bill • Call Money • Certificate of Deposits • Cash Management Bills (CMBs)

Treasury Bills

• Issued by RBI on behalf of govt. • Govt uses them to meet their short-term liquidity crunch. • T-bills are sovereign zero risk instruments. • At present, 3 types of T-bills are there: 91-day, 182-day, 364-day. • State govt. cannot issue T-bills. • They are issued by Market Stabilization Scheme (MSS). • Available for a minimum amount of Rs. 25000 or in multiples of that.

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Call Money

• Interbank market where funds are borrowed and lent for 1 day or less. • The money that is lent for one day in this market is known as "Call Money", and if it exceeds one day (but less than 15 days) it is referred to as "Notice Money". • Duration varying from 1 to 14 days, it is called Call money Market. • Mutual funds, scheduled commercial & cooperative banks act as both borrowers and lenders. • LIC, GIC, NABARD, IDBI act only as lenders.

Certificate of Deposit (CDs)

• Issued by scheduled commercial banks and other financial institutions. • RRBs and local area banks can not issue CDs. • Issued at a discount to face value, the discount rate is negotiated between issuer and investor. • Minimum amount to be Rs. 1 lac. • CDs issued by banks have a maturity period: 15 days to 1 year. • CDs issued by selected FIs have maturity period: 1 year to 3 years. • Can be issued to individuals or firms.

Commercial Paper (CP)

• These are unsecured promissory* notes issued by large corporates, primary dealers, satellite dealers and all India FIs. • Maturity period is between 7 days up to 1 year from date of issue. • Minimum amount to be invested is Rs. 5 lacs or multiples of that. • CPs need to have a credit rating from a credit rating agency.

Commercial Bills (CBs)

• Negotiable instruments which are issued by all India FIs, NBFCs, SCBs, Merchant banks & Mutual funds. • Drawn by seller on the buyer (buyer gives seller), hence also called trade bills.

Cash Management Bills (CMBs)

• It's a comparatively new short-term instrument issued by RBI on behalf of Govt. • Issued to meet temporary mismatches in cash flow of Govt. • They resemble T-bills in character but are issued for less than 91 days only.

Capital Market

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Capital Market 2 types

• Primary Market: Otherwise called as New Issues Market, it is the market for the trading of new securities, for the first time. It embraces both initial public offering and further public offering. In the primary market, the mobilisation of funds takes place through prospectus, right issue and private placement of securities. • Secondary Market: Secondary Market can be described as the market for old securities, in the sense that securities which are previously issued in the primary market are traded here. The trading takes place between investors, that follows the original issue in the primary market. It covers both stock exchange and over- the counter market.

Chapter 5: Inflation Inflation Inflation is a quantitative measure of the rate at which the average price level of a basket of selected goods and services in an economy increases over a period of time. Simply, inflation is rise in the prices of goods and services caused by the devaluation of currency.

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There are three major types of inflation

• Demand-pull inflation – This increase in liquidity and demand for consumer goods results in an increase in demand for products. As a result of the increased demand, companies will raise prices to the level the consumer will bear in order to balance supply and demand. • Cost-push inflation- Cost-push inflation, also called “supply shock inflation,” is caused by a drop in aggregate supply (potential output). This may be due to natural disasters, or increased prices of inputs, increases in corporate taxes, rising wages. • Built-in inflation – Built-in inflation is induced by adaptive expectations, and is often linked to the “price/wage spiral”. It involves workers trying to keep their wages up with prices (above the rate of inflation), and firms passing these higher labor costs on to their customers as higher prices, leading to a ‘vicious circle’. Deflation

• Deflation is a decrease in the general price level of goods and services. Deflation occurs when the inflation rate falls below 0% (a negative inflation rate). Deflation is the exact opposite of inflation. Inflation reduces the value of currency over time, but deflation increases it. This allows one to buy more goods and services than before with the same amount of currency. Stagflation

• Stagflation is a condition of slow economic growth and relatively high unemployment, or economic stagnation, accompanied by rising prices, or inflation. It can also be defined as inflation and a decline in gross domestic product (GDP). Galloping Inflation

• Galloping inflation also called as hopping inflation, jumping inflation, and running or runaway inflation is basically a very high inflation, which can be in the range of ‘double-digit’ or ‘triple-digit’ (for example: 50 % or 200% in a year). Causes of Inflation Factors on Demand Sides – • Increase in money supply • Increase in Export • Increase in disposable income • Deficit financing • Foreign exchange reserves

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Factors on Supply Side – • Rise in administered prices • Erratic agriculture growth • Agricultural price policy • Inadequate industrial growth Measurement of Inflation

• The Consumer Price Index (CPI) • Producer Price Index (PPI) Measures of Inflation Monetary policy • Credit Control • Demonetization of Currency • Issue of New Currency Fiscal policy • Reduction in Unnecessary Expenditure • Increase in Taxes • Increase in Savings • Surplus Budgets • Public Debt Other Measures • To Increase Production • Rational Wage Policy • Price Control

Chapter 6: Negotiable Instrument, Mutual Fund, Money Laundering What is Negotiable Instrument

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A negotiable instrument is a document guaranteeing the payment of a specific amount of money, either on demand, or at a set time, with the payer usually named on the document. Types of Negotiable Instruments • Promissory Note • Bills of Exchange • Promissory note • Demand Draft • Letter of credit • Cheque Bill of Exchange A bill of exchange is a written order used primarily in international trade that binds one party to pay a fixed sum of money to another party on demand or at a predetermined date. Features of Bill of Exchange: • Bills of exchange must be in writing. • Bills of exchange are not a request to pay and an order to pay. • The order must be signed by the drawer, i.e. the maker. • The order must be for the payment of money only. • The money payable not vague and must be certain. • The bills of exchange must be payable to a certain person mentioned in the instrument or to his order or to the bearer of the document. Promissory note Promissory note may be a negotiable instrument if it is an unconditional promise in writing made by one person to another, signed by the maker, engaging to pay on demand to the payee, or at fixed or determinable future time, certain in money, to order or to bearer. Cheque A Cheque is a document which orders a bank to pay a particular amount of money from a person’s account to another individual’s or company’s account in whose name the cheque has been made or issued. The person writing the cheque, known as the drawer. Demand Draft

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Demand Draft is a negotiable instrument used for the transfer of money from one place to another. It making payment to the bank. Demand Draft can’t be dishonored as the amount is paid beforehand. Demand Draft is issued by a bank. The amount in cash not exceeding Rs 50,000. In case of amount exceeding Rs 50,000, the payment is to be made by cheque along with giving the PAN No. It can be cleared at any branch of the same bank. The payment of a draft cannot be stopped. Letter of credit A letter of credit (LC), also known as a documentary credit or bankers commercial credit, is a payment mechanism used in international trade to provide an economic guarantee from a creditworthy bank to an exporter of goods. Maker/ Drawer The maker of a promissory note or cheque, the drawer of a bill of exchange until acceptance, and the acceptor are, in the absence of a contract to the contrary, respectively liable thereon as principal debtors, and the other parties thereto are liable thereon as sureties for the maker, drawer or acceptor, as the case may be. Drawee Drawee is a legal and banking term used to describe the party that has been directed by the depositor to pay a certain sum of money to the person presenting the check or draft. Payee A payee is the party in an exchange who receives payment. A payee is paid by cash, check or other transfer medium by a payer. Holder The Holder is either the payee or some other person to whom he may have endorsed the promissory note or bill of exchange or cheque. A person cannot be a holder unless he is the payee or indorsee there of. Money Laundering Money laundering is the process of making large amounts of money generated by a criminal activity, such as drug trafficking or terrorist funding, appear to have come from a legitimate source. The money from the criminal activity is considered dirty, and the process “launders” it to make it look clean. Money laundering is itself a crime. Money Laundering on International Basis On international Basis Financial action task force was established (FATF) to combat with money laundering cases and terrorism financing. • Established in 1989 • Headquarters – Geneva

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• Total member countries – 36 Introduction of Mutual Fund A mutual fund is a professionally managed investment fund that pools money from many investors to purchase securities. These investors may be retail or institutional in nature. Chapter 7: Types of Cheque & Types of Account Cheque A Cheque is a document which orders a bank to pay a particular amount of money from a person’s account to another individual’s or company’s account in whose name the cheque has been made or issued. The cheque is utilised to make safe, secure and convenient payments. It serves as a secure option since hard cash is not involved during the transfer process; hence the fear of loss or theft is minimised. Number of Parties involved with a Cheque Under the cheque mode of fund payment, there are three parties which are involved for on-track movement of money through a written paper source. • Drawer or Maker: He/she is the customer or account holder who issues the cheque. • Drawee: It is basically the bank on which the cheque is drawn and is called the “Drawee”. Always remember that a cheque is always drawn on a particular banker. • Payee: The individual who is named in the cheque for getting the payment is known as the “Payee”. Interestingly, the drawer and the payee can be the same individual in a particular case. Types of Cheque

• Bearer Cheque: Bearer cheques are the cheques which withdrawn to the cheque's owner. These types of cheques normally used for a cash transaction. • Order Cheque: Order cheques are the cheques which are withdrawn for the payee(the person whose name is written on the cheque). Before making payment to that payee,cross-checks check the identity of the payee. • Crossed Cheque: On the Crossed cheques, two lines are made on the top right of the cheque. Amount mentioned on the cheque is only transferred to the bank account of the payee. No cash payment is made. • Account Payee Cheque: On the Account payee cheque, two lines are made with the word "account payee" on the top right of the cheque. Amount mentioned on the cheque is only transferred to the bank account of the payee whose name is mentioned on the cheque. No cash payment is made. This cheque can not be endorsed to the third party. • Stale Cheque: In India, if a cheque is not presented to the bank within 3 months from the date written on the cheque is known as a stale cheque.

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• Post Dated Cheque: If any cheque issued by a holder to the payee for the upcoming withdrawn date, then that type of cheques are called post-dated cheque. • Ante Dated Cheque: If date entered on the cheque is prior to the current date, that type of cheque is known as Ante-dated cheque. Demand Draft • Demand Draft is a negotiable instrument used for the transfer of money from one place to another. It making payment to the bank. Demand Draft can’t be dishonoured as the amount is paid beforehand. • Demand Draft is issued by a bank. The amount in cash not exceeding Rs. 50,000. In case of amount exceeding Rs. 50,000, the payment is to be made by cheque along with giving the PAN No. It can be cleared at any branch of the same bank. The payment of a draft cannot be stopped. Letter of credit (LC) • A letter of credit (LC), also known as a documentary credit or bankers commercial credit, is a payment mechanism used in international trade to provide an economic guarantee from a creditworthy bank to an exporter of goods. Bank Account A bank account is a financial account maintained by a bank or other financial institution in which the financial transactions between the bank and a customer are recorded.

Savings Account A savings account is a deposit account held at a retail bank that pays interest. Any individual either single or jointly can open a savings account. Most of the salaried persons, pensioners and students use Savings Account. Current Account

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The current account is a country’s trade balance net income and direct payments. The trade balance is a country’s imports and exports of goods and services. The current account also measures international transfers of capital. Basic Savings Bank Deposit Accounts (BSBDA)

• A person having savings account can open a BSBDA in the same bank. But he will have to close the savings account within 30 days from the date of opening of BSBDA. • With the introduction of BSBDA, ‘no-frills’ account with ‘nil’ or very low minimum balances have been converted to BSBDA • Total credits in such accounts should not exceed one lakh rupees in a year. • Maximum balance in the account should not exceed fifty thousand rupees at any time. • In a month, the total of cash withdrawals and transfers cannot exceed Rs 10,000.

Recurring Deposit Account

• Recurring Deposit is a special kind of Term Deposit offered by banks in India which help people with regular incomes to deposit a fixed amount every month into their Recurring Deposit account and earn interest • Recurring Deposit schemes allow customers with an opportunity to build up their savings through regular monthly deposits of fixed sum over a fixed period of time. Minimum Period of RD is 6 months and maximum is 10 years. • There are no limits for number of transactions or the amount of transactions in a day. • There is no interest paid on amount held in the account, banks charges certain service charges, on such accounts.

Fixed Deposit Account

• A fixed deposit (FD) is a financial instrument provided by banks or NBFCs which provides investors a higher rate of interest than a regular savings account, until the given maturity date. It may or may not require the creation of a separate account. It is known as a term deposit or time deposit.

Important Feature

• Customers can avail loans against FDs up to 80 to 90 percent of the value of deposits. The rate of interest on the loan could be 1 to 2 percent over the rate offered on the deposit. • Residents of India can open these accounts for a minimum of 3 months. • Investing in a fixed deposit earns you a higher interest rate than depositing your money in a saving account. • The tenure of an FD can vary from 7, 15 or 45 days to 1.5 years and The longest permissible term for FDs is 10 years.

Demat Account

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• The full form of Demat Account is Dematerialized account. A Demat Account is an account that allows investors to hold their shares in an electronic form. Demat account functions like a bank account, where you hold your money and respective entries are done in bank passbook.

CASA Account

• CASA stands for current and savings account ratio. CASA ratio of a bank is the ratio of deposits in current and saving accounts to total deposits.

RAFA Account

• RAFA stands for Recurring Deposit Account Fixed Deposit Account. The RAFA ratio shows how much deposit a bank has in the form of Recurring and fixed deposits.

NRI ACCOUNTS

• NRO ( Non-Resident Ordinary Rupees) Account • NRE ( Non-Resident External Rupees) Account • FCNR ( Foreign Currency Non-Resident ) Account NRO ( Non-Resident Ordinary Rupees) Account

Different Between NRE and NRO account Basis NRE Account NRO Account Acronym Non Resident External Non Resident Ordinary Account Account Meaning It is an account of an NRI to It is an account of an NRI to manage the transfer foreign earnings to income earned in India India Taxability Interest earned is tax free Interest earned is taxable Repatriability Can repatriate Can repatriate the interest amount, the principle amount can be repatriated within the set limits Joint Account Can be opened by two NRIs Can be opened by an NRI along with an Indian citizen or another NRI Deposits and Can deposit in foreign Can deposit in foreign as well as Indian Withdrawals currency, and withdraw in currency, and withdraw in Indian Indian currency currency Exchange Rate Prone to risk Not prone to risk Risk

Chapter 8: Types of Payment Cards, Fund transfer service Plastic money is a term used to represent the hard plastic cards used in day to day life in place of actual banknotes. They come in several forms such as debit cards, credit cards, store cards and pre-paid cash cards. The plastic cards began to be used widely after 1970

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Today the domestic card industry is applied with different types of cards from gold, silver, global, smart to secure, co-branded credit cards, etc. the list is endless. There is enormous growth potential in the domestic card industry.

Types Of Plastic Money

Charge Card: A charge card has similar features of credit cards. However, after using a charge card, it is necessary to pay the whole amount of bill till the due date. If the person defaults to pay the amount of the charge card, then he has to pay the late payment charges.

Visa & MasterCard: Visa & MasterCard are international non-profit organizations. They are dedicated to promoting the growth of the business of cards across the globe. They have designed a wide network of merchant institutions by keeping in mind that the customers might use their credit cards to make several transactions worldwide.

Debit Cards: The is an encoded plastic card which is issued by banks and has replaced with the cheques. It allows the customers to pay in exchange for goods and services without carrying cash. It is a multipurpose card, as it can be used as an ATM to withdraw the money and check the balance of the bank account. It is issued by bank free of cost with the savings or current account. It is one of the best online-payment tools where the amount of purchase is immediately subtracted from the account of the customer and credited to the merchant’s account. It has overcome the delay in the payment process.

There are presently two ways in which debit cards transactions are processed: i)Online debit (also known as a PIN) ii)Offline debit (also known as signature debit

ATM Cards: These cards are typically used at ATMs to withdraw money, transfer funds and make deposits. ATM cards are used by inserting the card into a machine and enter a PIN or personal number for security purpose. The system checks the account for sufficient funds before allowing any transaction. Fund transfer services

• National Electronic Funds Transfer (NEFT) • Real-time gross settlement (RTGS) • Immediate Payment Service (IMPS)

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Chapter 9: Basel I, II and III

Basel Accords

The Basel Accords refer to the banking supervision Accords (recommendations on banking regulations)—Basel I, Basel II and Basel III—issued by the Basel Committee on Banking Supervision (BCBS). They are called the Basel Accords as the BCBS maintains its secretariat at the Bank for International Settlements in Basel, Switzerland and the committee normally meets there. The Basel Accords is a set of recommendations for regulations in the banking industry.

Basel I

Basel I is the round of deliberations by central bankers from around the world, and in 1988, the Basel Committee on Banking Supervision (BCBS) in Basel, Switzerland, published a set of minimum capital requirements for banks. This is also known as the 1988 Basel Accord, and was enforced by law in the Group of Ten (G-10) countries in 1992. Basel I norms set a minimum capital requirements for banks. It defined capital requirement and structure of risk weights for banks. The goal was to minimize credit risk i.e. the defaults on a credit or loan when the borrower is unable to pay back to the bank.

Basel-II

The Basel II Accord was published initially in June 2004 and was intended to amend international banking standards that controlled how much capital banks were required to hold to guard against the financial and operational risks banks face. These regulations aimed to ensure that the more significant the risk a bank is exposed to, the greater the amount of capital the bank needs to hold to safeguard its solvency and overall economic stability.

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Basel II was implemented in the years prior to 2008, Basel II uses a “three pillars” concept – (1) minimum capital requirements (addressing risk), (2) supervisory review and (3) market discipline.

Basel-III

Basel III (or the Third Basel Accord or Basel Standards) is a global, voluntary regulatory framework on bank capital adequacy, stress testing, and market liquidity risk. This third installment of the Basel Accords (see Basel I, Basel II) was developed in response to the deficiencies in financial regulation revealed by the financial crisis of 2007–08. It is intended to strengthen bank capital requirements by increasing bank liquidity and decreasing bank leverage.

Basel III was agreed upon by the members of the Basel Committee on Banking Supervision in November 2010, and was scheduled to be introduced from 2013 until 2015; however, implementation was extended repeatedly to 31 March 2019. it has now been decided to extend the dispensation of enhanced HTM of 22 per cent up to March 31, 2023 to include securities acquired between April 1, 2021 and March 31, 2022

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Chapter 10: NPA & SARFAESI Act, 2002

What is NPA NPA Meaning (Non-performing Assets) - All those assets which don't generate regular income are known as NPA. Types of assets • Standard assets :- Assets which are generating regular income to the bank • Sub-standard assets :- An asset which is overdue for a period of more than 90 days but less than 12 months • Doubtful assets :- An asset which is overdue for a period of more than 12 months. • Loss assets :- Assets which are doubtful and considered as non-recoverable by bank, internal or external auditor or central bank inspectors • Sub-standard assets, Doubtful assets and Loss assets are NPA.

SARFAESI Act, 2002

Narasimham Committee I and II and Andhyarujina Committee was constituted by the Central Government for the purpose of examining banking sector reforms have considered the need for changes in the legal system in respect of these areas. Amongst the other committees, these Committees have made suggestions to form new legislation for securitization and empowering banks and financial institutions to gain possession of the securities and to sell them without any intervention of the court here.

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Applicability Of SARFAESI Act, 2002

The amendment to this Act is “an act to regulate securitization and reconstruction of financial assets and enforcement of security interest and to provide for a central database of security interests created on property rights, and for matters connected therewith or incidental thereto.”

The Act deals with the following:

• Registration and regulation of Asset Reconstruction Companies (ARCs) by the Reserve Bank of India • Facilitating securitization of financial assets of banks and financial institutions with or without the benefit of underlying securities • Promotion of seamless transferability of financial assets by the ARC to acquire financial assets of banks and financial institutions through the issuance of debentures or bonds or any other security as a debenture • Entrusting the Asset Reconstruction Companies to raise funds by issue of security receipts to qualified buyers • Facilitating the reconstruction of financial assets which are acquired while exercising powers of enforcement of securities or change of management or other powers which are proposed to be conferred on the banks and financial institutions • Presentation of any securitization company or asset reconstruction company registered with the Reserve Bank of India as a public financial institution • Defining ‘security interest’ to be any type of security including mortgage and change on immovable properties given for due repayment of any financial assistance given by any bank or financial institution • Classification of the borrower’s account as a non-performing asset in accordance with the directions given or under guidelines issued by the Reserve Bank of India from time to time • The officers authorized will exercise the rights of a secured creditor in this behalf in accordance with the rules made by the Central Government • An appeal against the action of any bank or financial institution to the concerned Debts Recovery Tribunal and a second appeal to the Appellate Debts Recovery Tribunal • The Central Government may set up or cause to be set up a Central Registry for the purpose of registration of transactions relating to securitization, asset reconstruction and creation of the security interest • Application of the proposed legislation initially to banks and financial institutions and empowerment of the Central Government to extend the application of the proposed legislation to non-banking financial companies and other entities • Non-application of the proposed legislation to security interests in agricultural lands, loans less than rupees one lakh and cases where eighty per cent, of the loans, is repaid by the borrower

Objectives of SARFAESI Act, 2002

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• Efficient or rapid recovery of non-performing assets (NPAs) of the banks and FIs. • Allows banks and financial institutions to auction properties (say, commercial/residential) when borrower fail to repay their loans.

Chapter 11: LIBOR & MIBOR, SWIFT Codes for banks

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Chapter 12: Banking Ombudsman Scheme (India) & CIBIL Bank Credit What Is Bank Credit? Bank credit is the total amount of credit available to a business or individual from a banking institution. It consists of the total amount of combined funds that financial institutions provide to an individual or business. A business or individual's bank credit depends on the borrower's ability to repay the loan and the total amount of credit available in the banking institution. How Bank Credit Works Bank credit is the total borrowing capacity banks provide to borrowers. The credit allows borrowers to buy goods or services. Bank Credit requires a fixed minimum monthly payment for a certified period

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Priority Sector lending Priority Sector refers to those sectors of the economy which may not get timely and adequate credit. Priority Sector Lending is an important role given by the Reserve Bank of India (RBI) to the banks for providing a specified portion of the bank lending to few specific sectors. The sectors may be agriculture and allied activities, micro and small enterprises, poor people for housing, students for education and other low income groups and weaker sections. This is essentially meant for an all round development of the economy as opposed to focusing only on the financial sector. As per the RBI circular released in 2016, there are eight broad categories of the Priority Sector Lending. They are: (1) Agriculture (2) Micro, Small and Medium Enterprises (3) Export Credit (4) Education (5) Housing (6) Social Infrastructure (7) Renewable Energy (8) Others. The others category includes personal loans to weaker section, loans to distressed persons, loans to state sponsored organisations for SC/ST. Banks Mergers

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Banking order (Largest to Smallest)

• State Bank of India • PNB +OBC +United Bank:- Punjab National Bank • + Vijya Bank+ Dena Bank:- Bank of Baroda • Canara + :- Canara Bank • Union Bank + +: Bank of India • + :- Indian Bank • • • UCO Bank • • Punjab and Sind Bank

Chapter 13: Important Terms

Retail banking

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Retail banking, also known as consumer banking, is the provision of services by a bank to the general public, rather than to companies, corporations or other banks, which are often described as wholesale banking. Banking services which are regarded as retail include provision of savings and transactional accounts, mortgages, personal loans, debit cards, and credit cards. Retail banking is also distinguished from or commercial banking. Call money Call money is money loaned by a bank that must be repaid on demand. The money that is lent for one day in this market is known as “Call money“. Notice Money In the call money is usually availed for one day. If the bank needs funds for more days, it can avail money through notice market. Here, the loan is provided from two days to fourteen days. This is called notice money. Green Banking Green banking aims at improving the operations and technology along with making the clients habits environment-friendly in the banking business. It is like normal banking i. e. in addition to financing social activities does business in environmental activities including its financing. Skimming Skimming is a tactic used predominantly for credit-card fraud. Credit card fraud is a wide-ranging term for theft and fraud committed using or involving a , such as a credit card or debit card, as a fraudulent source of funds in a transaction. The purpose may be to obtain goods without paying, or to obtain unauthorized funds from an account. Proportional reserve system Under the proportional reserve system, certain proportion of currency notes (40%) are backed by gold and silver reserves and the remaining part of the note issue by approved securities. Minimum Reserve System RBI is required to maintain a Gold and Foreign Exchange Reserves of Rs. 200 Crore of which at least Rs. 115 Crore should be in Gold. This is called Minimum Reserve system. Camels rating The CELS ratings or Camels rating is a supervisory rating system originally developed in the U.S. to classify a bank’s overall condition. It is applied to every bank and credit union in the U.S. It also implemented outside the U.S. by various banking supervisory regulators. Each factor is assigned a weight as follows:

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• Capital adequacy -20 % • Asset quality -20% • Management- 25% • Earnings -15% • Liquidity- 10% • Sensitivity -10% Core banking Solution Core (Centralized Online Real-time Exchange) banking is a banking service provided by a group of networked bank branches where customers may access their bank account and perform basic transactions from any of the member branch offices. Unified Payments Interface Unified Payments Interface (UPI) is an instant real-time payment system developed by National Payments Corporation of India facilitating inter-bank transactions. UPI is a payment system that allows money transfer between any two bank accounts by using a smartphone. UPI allows a customer to pay directly from a bank account to different merchants, both online and offline, without the hassle of typing credit card details, IFSC code, or net banking/wallet passwords. The Balance of Trade The difference of the country’s exports and the value of its imports are known as the Balance of Trade. Important features: • The cost of production (land, labor, capital, taxes, incentives, etc.) in the exporting economy vis-à-vis those in the importing economy; • Currency exchange rate movements; • Multilateral, bilateral and unilateral taxes or restrictions on trade; • The availability of adequate foreign exchange with which to pay for imports; and Prices of goods manufactured at home (influenced by the responsiveness of supply). A Balance of Payments The balance of payments, also known as balance of international payments and abbreviated B.O.P. or BoP, of a country is the record of all economic transactions between the residents of the country and the rest of the world in a particular period of (generally 1 year). Cheque Truncation System (CTS) Cheque Truncation System (CTS) or Image-based Clearing System (ICS), in India, is a project of the Reserve Bank of India (RBI), commenced in 2010, for faster clearing of cheques. CTS is based on a cheque truncation or online image-based cheque clearing

Best Online Test Series Site for Bank | JAIIB | CAIIB | RRB NTPC | SSC and State Government 34 Jobs ambitiousbaba.com Online Test Series system where cheque images and magnetic ink character recognition (MICR) data are captured at the collecting bank branch and transmitted electronically. Cheque truncation means stopping the flow of the physical cheques issued by a drawer to the drawee branch. Shadow banking system The shadow banking system is a term for the collection of non-bank financial intermediaries that provide services similar to traditional commercial banks but outside normal banking regulations. Likes Non-banking financial companies (NBFCs) The shadow banking sector plays an important role in promoting financial inclusion. The main Benefits of shadow banks lie in their ability to reduce transaction costs, their quick decision making ability, and customer orientation and prompt delivery of services. But there is also a risk in shadow banking practice in any economy because they can take their own decisions. Special drawing rights Special drawing rights are supplementary foreign-exchange reserve assets defined and maintained by the International Monetary Fund (IMF).The SDR is the unit of account for the IMF, and is not a currency per se. SDRs instead represent a claim to currency held by IMF member countries for which they may be exchanged. The SDR was created in 1969 to supplement a shortfall of preferred foreign-exchange reserve assets, namely gold and the U.S. dollar. Participatory Notes Participatory Notes commonly known as P-Notes or PNs are instruments issued by registered foreign institutional investors (FII) to overseas investors, who wish to invest in the Indian stock markets without registering themselves with the market regulator, the Securities and Exchange Board of India – SEBI. Participatory notes are instruments used for making investments in the stock markets. However, they are not used within the country. They are used outside India for making investments in shares listed in the Indian stock market. Liabilities of A Bank In the simplest of terms, the bank’s liabilities are deposits, money that people deposit with the bank, because the banks owes that money to the depositors. Below are some of the products

• Capital and Reserves • Savings account, current account, salary account • Fixed deposits • Recurring deposits • Insurance

Assets of a Bank

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The asset products are those in which the customer is liable to pay to the bank. In banking term Assets are loans the banks makes to borrowers. Any type of loans like

• Cash • Money at Call at Short Notice • Investments • Loans, Advances and Bills Discounted-or Purchased • Demand Loans • Term Loans • personal loan, car loan, education loan Etc • Credit card

Initial Public Offering (IPO) Initial public offering (IPO) or stock market launch is a type of public offering in which shares of a company are sold to institutional investors and usually also retail (individual) investors; an IPO is underwritten by one or more investment banks, who also arrange for the shares to be listed on one or more stock exchanges. Through this process, colloquially known as floating, or going public, a privately held company is transformed into a public company. Initial public offerings can be used: to raise new equity capital for the company concerned; to monetize the investments of private shareholders such as company founders or private equity investors; and to enable easy trading of existing holdings or future capital raising by becoming publicly traded enterprises. Advantages of IPO

• Enlarging and diversifying equity base • Enabling cheaper access to capital • Increasing exposure, prestige, and public image • Attracting and retaining better management and employees through liquid equity participation • Facilitating acquisitions (potentially in return for shares of stock) • Creating multiple financing opportunities: equity, convertible debt, cheaper bank loans, etc.

Mortgage

A loan used to buy real estate. A mortgage is secured by the property it is used to purchase. One must make monthly payments on a mortgage, and there is a set term before full payment is due, often 15, 20, or 30 years. Some mortgages have fixed interest rates, while others have variable interest rates. If one defaults on a mortgage, the bank making it may take possession of the real estate and sell it to recover its investment. Some banks, notably savings and loans, specialize in making mortgage loans.

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Chapter 14: Micro, Small and Medium Enterprise in India The Micro, Small and Medium Enterprises Development (MSMED) Act, 2006, governs the coverage and investment ceiling of MSMEs in India. According to the Act, there are two categories of MSMEs in the country –

Manufacturing: Manufacturing Enterprises-he enterprises engaged in the manufacture or production of goods pertaining to any industry specified in the first schedule to the industries (Development and regulation) Act, 1951) or employing plant and machinery in the process of value addition to the final product having a distinct name or character or use. The Manufacturing Enterprise are defined in terms of investment in Plant & Machinery. Service Enterprises:-The enterprises engaged in providing or rendering of services and are defined in terms of investment in equipment.. The limit for investment in plant and machinery / equipment for manufacturing / service enterprises, as notified,vide S.O. 1642(E) dtd.29-09-2006 are as under

Composite Criteria: Investment in Plant & Machinery/equipment and Annual Turnover

Classification Micro Small Medium

Investment in Investment in Investment in Plant and Plant and Plant and Machinery or Machinery or Machinery or Equipment: Equipment: Equipment: Not more than Not more than Not more than Manufacturing Rs.1 crore and Rs.10 crore and Rs.50 crore and Enterprises and Annual Annual Annual Enterprises Turnover ; not Turnover ; not Turnover ; not rendering more than Rs. 5 more than Rs. more than Rs. Services crore 50 crore 250 crore

Performance & Credit Rating Scheme This scheme seeks to establish independent, trusted third party opinion on capabilities and credit-worthiness of MSEs, and makes credit available at attractive interest rates and will ensure better productivity. Under this scheme (as per the turnover of the MSE) a percent of Rating Agency charges are reimbursed by Ministry of SSI. Scheme Benefits & Highlights

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The fee to be paid to the rating agencies shall be based on the turnover of the Small- Scale Units which has been categorized into three slabs. The slabs of the Turnover and the Share of Ministry of SSI towards the fee charged by the Rating Agency is as follow: Turnover of MSE Re-imbursement of fee through NSIC: • Up to Rs. 50 lakh - 75% of the fee or INR25,000 (whichever is less) • Above Rs. 50 to 200 lakh - 75% of the fee or INR30,000 (whichever is less) • More than Rs. 200 lakh - 75% of the fee or INR40,000 (whichever is less) Credit Guarantee Any collateral / third party guarantee free credit facility (both fund as well as non fund based) extended by eligible institutions, to new as well as existing Micro and Small Enterprise, including Service Enterprises, with a maximum credit cap of of 200 lakh (Rupees Two Hundred lakh only) are eligible to be covered. Recently, guarantee coverage made eligible to select NBFCs and Small Finance banks. The guarantee cover available under the scheme is to the extent of 50%/ 75% / 80% & 85% of the sanctioned amount of the credit facility. The extent of guarantee cover is 85% for micro enterprises for credit up to 5 lakh. The extent of guarantee cover is 50% of the sanctioned amount of the credit facility for credit from 10 lakh to 100 lakh per MSE borrower for retail trade activity. The extent of guarantee cover is 80%(i) Micro and Small Enterprises operated and/or owned by women; and (ii) all credits/loans in the North East Region (NER) for credit facilities upto 50 lakh. In case of default, Trust settles the claim up to 75% of the amount in default of the credit facility extended by the lending institution for credit facilities upto 200 lakh.

Category Maximum extent of Guarantee where credit facility is Upto 5 lakh Above 5 lakh Above 50 lakh upto 50 lakh upto 200 lakh Micro Enterprises 85% of the 75% of the amount 75% of the amount amount in in default subject to a in default subject to a default subject maximum of 37.50 maximum of 150 to a maximum lakh lakh of 4.25 lakh Women entrepreneurs/ 80% of the amount in default subject Units located in North East to a maximum of 40 lakh Region (incl. Sikkim) (other than credit facility upto 5 lakh to micro enterprises)

All other category of 75% of the amount in default subject borrowers to a maximum of 37.50 lakh Activity From 10 lakh upto 100 lakh MSE Retail Trade 50% of the amount in default subject to a maximum of 50 lakh

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Chapter 15: Regional Rural Bank (RRB)

Regional Rural Banks (RRBs) also known as Gramin banks, are Indian scheduled banks (Government banks) operating at regional level in different States of India. They have been created with a view of serving primarily the rural areas of India with basic banking and financial services.

• Regional Rural Banks were established under the provisions of an Ordinance passed in September 1975 and the RRB Act 1976 to provide sufficient banking and credit facility for agriculture and other rural sectors. • These were set up on the recommendations of The Narshimham committee Working Group during the tenure of Indira Gandhi’s government with a view to include rural areas into economic mainstream since that time about 70% of the Indian Population was of Rural Orientation. • The development process of RRBs started on 2 October 1975 with the forming of the first RRB, the Prathama Bank with authorised capital of ₹5 crore at its starting. • Also on 2 October 1975 five regional rural banks were set up with a total authorised capital ₹100 crore ($10 Million) which later augmented to 500 crore ($50 million). • The Regional Rural Banks were owned by the Central Government, the State Government and the Sponsor Bank (Any commercial bank can sponsor the regional rural banks) who held shares in the ratios as follows Central Government – 50%, State Government – 15% and Sponsor Banks – 35%. • The first RRB to be set up was the Prathama Bank, sponsored by Syndicate Bank on October 2, 1975 in Uttar Pradesh. The head office is at Moradabad, UP. • The regulatory authority of these RRBs is NABARD • All states in India have RRBs, except Sikkim and Goa. • 43 RRB in India.

List of Regional Rural Banks in India (Present Time)

1 2 Andhra Pradesh Grameena Vikas Bank 3 Andhra Pragathi Grameena Bank 4 Arunachal Pradesh Rural Bank 5 Aryavart Bank 6 Bangiya Gramin Vikash Bank 7 Baroda Gujarat Gramin Bank 8 Baroda Rajasthan Kshetriya Gramin Bank 9 Baroda UP Bank 10 Chaitanya Godavari GB 11 Chhattisgarh Rajya Gramin Bank 12 Dakshin Gramin Bank 13 Ellaquai Dehati Bank 14 Himachal Pradesh Gramin Bank 15 J&K Grameen Bank 16 Jharkhand Rajya Gramin Bank

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17 Gramin Bank 18 Karnataka Vikas Gramin Bank 19 20 Madhya Pradesh Gramin Bank 21 22 23 Manipur Rural Bank 24 Meghalaya Rural Bank 25 26 Nagaland Rural Bank 27 28 Paschim Banga Gramin Bank 29 Prathama U.P. Gramin Bank 30 Puduvai Bharathiar Grama Bank 31 Punjab Gramin Bank 32 Rajasthan Marudhara Gramin Bank 33 Saptagiri Grameena Bank 34 Sarva Haryana Gramin Bank 35 Saurashtra Gramin Bank 36 Tamil Nadu Grama Bank 37 Telangana Grameena Bank 38 Gramin Bank 39 Uttar 40 41 Uttarbanga Kshetriya Gramin Bank 42 Vidharbha Konkan Gramin Bank 43 Uttarakhand Gramin Ban

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Banking and Financial News PDF 2021 (Feb to August) Index No. of Topic Topic Name Topic 1 List of Banks who has been imposed penalty by RBI in 2021 Topic 2 List of Banks whose licence has been canceled by RBI in 2021 Topic 3 Important Committee (Feb to July) Topic 4 List of Merger and Acquisition (Covered Feb to July) Topic 5 List of Partnership/Agreement (Covered Feb to July) Topic 6 List of loan agreement for India from different organizations 2021 Topic 7 Union Budget 2021-22: Highlights Topic 8 RBI Annual Report 2021 Topic 9 Banking & Financial News (Feb to July) Topic 10 India’s GDP Growth Forecast FY 21 and 22 by various Financial Organizations (last Update 10 August 2021)

Topic 1: List of Banks who has been imposed penalty by RBI in 2021 (Covered January to August)

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RBI slaps penalty of Rs 2 crore on Standard The Reserve Bank of India (RBI) has imposed Chartered Bank a monetary penalty of Rs 2 crore on Bank–India for delays in reporting of frauds. The penalty has been imposed on the bank for non-compliance with certain directions issued by it contained in the ‘Reserve Bank of India" Directions 2016’. RBI fines Bajaj Finance Rs 2.5 crore for The Reserve Bank of India (RBI) has imposed recovery agent harassment Rs 2.50 crore monetary penalty on Bajaj Finance for violating RBI’s directions on fair practices code (FPC) and outsourcing of financial services by a non-banking financial company. RBI slaps Rs 2 crore fine on The Reserve Bank of India has imposed a for non-compliance penalty of Rs 2 crore on Deutsche Bank AG for non-compliance with certain provisions of directions concerning interest rate on deposits. RBI imposed Rs 2 crores penalty on SBI for Reserve Bank of India on March 16, 2021 paying commission to employees imposed a penalty of Rs 2 crore on State Bank of India (SBI) for contravention of norms, including specific directions to the lender on remuneration to its employees in the form of commission. The penalty has been imposed for contravention of certain sections of Banking Regulation Act and its specific directions of RBI issued to the bank on payment of remuneration to employees in the form of commission.

RBI imposed a Rs 3-cr penalty on ICICI Bank The Reserve Bank of India (RBI) on 3rd May for violating prudential norms fined ICICI Bank Rs 3 crore for violating prudential norms on the operation of its investment portfolio. RBI imposes a penalty on , 3 The RBI has imposed monetary penalty on other lenders City Union Bank, Tamilnad Mercantile Bank and two other lenders for contravention of certain directions issued by the central bank. A penalty of Rs 1 crore has been imposed on City Union Bank Limited for contravention of/non-compliance with certain provisions contained in the RBI (Lending to MSME Sector) Directions and Rs 1 crore on Tamilnad Mercantile Bank for non-compliance.

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RBI imposed Rs 10 crore penalty on HDFC The Reserve Bank has imposed a penalty of bank over irregularities in auto loan Rs 10 crore on HDFC Bank for deficiencies in portfolio regulatory compliances with regard to its auto loan portfolio. The order imposing the fine was issued on May 27 for contraventions of certain provisions of the Banking Regulation Act, 1949. Reserve Bank imposed penalty on Bank of The RBI on 7th June imposed penalty India, PNB totalling Rs 6 crore aggregating to Rs 6 crore on Bank of India and Punjab National Bank for contravention of norms, including one related to "Frauds Classification and Reporting". A penalty of Rs 4 crore has been imposed on Bank of India and Rs 2 crore on Punjab National Bank.

RBI imposed Rs 25 lakh penalty on Punjab & The Reserve Bank of India imposed a penalty Sind Bank of Rs 25 lakh on Punjab and Sind Bank for non-compliance with certain provisions of directions on ‘Cyber Security Framework in Banks. This penalty has been imposed in the exercise of powers vested in RBI under the provisions of section 47 A (1) (c) read with sections 46 (4) (i) and 51 (1) of the Banking Regulation Act, 1949. RBI imposed monetary penalty on 14 banks The RBI on 8th July said it has imposed for non-compliance penalties on SBI, Bank of Baroda, IndusInd Bank, and 10 other lenders for contravention of various regulatory norms, including on lending to NBFCs. The penalty imposed on the 14 banks totals Rs 14.5 crore, with a maximum Rs 2 crore fine on Bank of Baroda. Note: Rs. 2Cr: Bank of Baroda. Rs. 1Cr: Bandhan Bank, Bank of Maharashtra, Central Bank of India, AG, Indian Bank, IndusInd Bank, , , Punjab and Sind Bank, , The Jammu & Kashmir Bank, and Utkarsh Small Finance Bank. Rs 50 lakhs: SBI

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RBI fined Axis Bank Rs 5 crore for non- The Reserve Bank of India (RBI) on 28th July compliance with certain rules imposed Rs 5-crore fine on Axis Bank for non-compliance with certain provisions of the central bank's norms on payment ecosystem between banks as a corporate customer, cyber security, and financial inclusion norms. RBI imposes Rs 1 crore penalty Cooperatieve Reserve Bank of India (RBI) on 13th Aug said it U.A. has imposed a penalty of Rs 1 crore on Cooperatieve Rabobank U.A. for deficiencies in regulatory compliances. The penalty has been imposed for contravention of certain provisions of the Banking Regulation Act, 1949 and directions related to 'transfer to reserve funds'. RBI imposes penalty of Rs 50.35 lakh on Reserve Bank of India has imposed a penalty of Janalaxmi Co-operative Bank Rs 50.35 lakh on Janalaxmi Co-operative Bank, Nashik for non-compliance with certain regulatory requirements. The penalty on Janalaxmi Co-operative Bank has been imposed for non-compliance with directions issued by RBI on ‘Placement of Deposits with Other Banks by Primary (Urban) Co-operative Banks’ and ‘Membership of Credit Information Companies (CICs)’.

Topic 2: List of Banks whose licence has been canceled by RBI in 2021 (Covered January to August) RBI cancels the licence of The Reserve Bank of India (RBI) has cancelled the Vasantdada Nagari Sahakari Bank licence of Vasantdada Nagari Sahakari Bank Ltd., Osmanabad, Maharashtra to carry on banking business, with effect from the close of business on January 11. Osmanabad, Maharashtra is prohibited from conducting the business of ‘banking’ which includes acceptance of deposits and repayment of deposits as defined in Section 5(b) read with Section 56 of the Banking Regulation Act, 1949 with immediate effect.

RBI cancels license of Kolhapur's The RBI on 30th Jan said the licence of Maharashtra- Shivam Sahakari Bank due to based Shivam Sahakari Bank has been cancelled as it inadequate capital does not have adequate capital and earning prospects.

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Reserve Bank of India (RBI) will Reserve Bank of India (RBI) has issued a show-cause Cancel the Licence of Sambandh notice prior to cancelling the licence of fraud-hit Finserve Sambandh Finserve Pvt Ltd. after its networth eroded below the regulatory minimum and financial situation worsened beyond redemption over the recent months. Sambandh is registered as an NBFC-MFI. The Managing Director and CEO of Sambandh, Deepak Kindo, who was allegedly the main perpetrator of the fraud, has been arrested by Economic Offence Wing, Chennai.

RBI canceled licence of United Co- Reserve Bank of India (RBI) has cancelled the licence operative Bank of United Co-operative Bank Ltd over inadequate capital, regulatory non-compliance, based in Bagnan, West Bengal. RBI said it cancelled the licence as United Co-operative Bank did not have adequate capital and earning prospects. "As such, it does not comply with the provisions of section 11(1) and section 22(3)(d) read with section 56 of the Banking Regulation Act, 1949.

RBI cancelled license of Pune-based The Reserve Bank of India (RBI) has cancelled the cooperative bank licence of Shivajirao Bhosale Sahakari Bank, Pune as the lender does not have adequate capital and earning prospects. As such, it does not comply with the provisions of section 11(1) and section 22 (3) (d) read with section 56 of the Banking Regulation Act, 1949. The bank has failed to comply with the requirements of section 22(3) (a), 22 (3) (b), 22(3)(c), 22(3) (d) and 22(3)(e) read with section 56 of the Banking Regulation Act, 1949. "Consequently, the bank ceases to carry on banking business, with effect from the close of business on May 31, 2021.

RBI's ban on Mastercard may hit Card issuance by banks and credit card issuers that card issuance of private lenders have co-branded credit cards with vendors on the Mastercard platform or exclusive tie-ups with the payment network for their own credit card issuance will take a hit for the time being now that the Reserve Bank of India (RBI) has barred Mastercard from onboarding new customers over non-compliance with local data storage regulations.

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RBI canceled licence of Dr The Reserve Bank of India (RBI) has cancelled the Shivajirao Patil Nilangekar Urban licence of Dr Shivajirao Patil Nilangekar Urban Co- Co-operative Bank operative Bank Ltd, Nilanga, Latur, as it does not have adequate capital and earning prospects.

RBI canceled licence of Goa-based Reserve Bank of India (RBI) has cancelled the licence Madgaum Urban co-op bank. of Goa-based Madgaum Urban Cooperative Bank, with effect from July 29, 2021. RBI said the decision was taken as the bank doesn't have adequate capital and earning prospects, and its would be unable to pay its present depositors in full in its present financial position. RBI cancels licence of Karnala The Reserve Bank has cancelled the licence of Karnala Nagari Sahakari Bank, Panvel in Nagari Sahakari Bank, Panvel in Maharashtra for not Maharashtr having adequate capital and being unable to pay its present depositors in full.

Topic 3: Important Committee (Covered Feb to August) August Committee Headed by Purpose RBI appointed panel under the chairmanship of N. S. Vishwanathan suggests 4-tier structure for Urban Co- operative Banks; minimum CRAR (Capital to Risk-Weighted Assets Ratio) for them could vary from 9 per cent to 15 per cent.

A Reserve Bank-appointed committee has suggested a four-tier structure for the urban Committee on cooperative banks (UCBs) depending upon the suggesting 4-tier N. S. deposits and prescribed different capital structure for Urban Vishwanathan adequacy and regulatory norms for them Co-operative Banks based on their sizes.

The RBI committee said that UCBs can be split into four categories — Tier-1 with deposits up to Rs 100 crore; Tier-2 with deposits between Rs 100-Rs 1,000 crore, Tier- 3 with deposits between Rs 1,000 crore to Rs 10,000 and Tier-4 with deposits of over Rs 10,000 crore.

June, 2021

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Committee Headed by Purpose

Variable Capital K.P. Krishnan Dr. K.P. Krishnan committee on “Variable Company Capital Company” has submitted its report to International Financial Services centres Authority (IFSCA) regarding feasibility of Variable Capital Companies in International Financial Services Centres in India.

Four-member N. K. Sodhi SEBI has reconstituted its four- Takeover Panel by member Takeover Panel Under the SEBI chairmanship Former Justice N. K. Sodhi, which looks into the applications that seek exemption from the mandatory open offer that an acquirer needs to make to minority shareholders.

Members of the Panel are:

• Chairman: N. K. Sodhi

• Member: Darius Khambata

• Member: Thomas Mathew

• Member: N Venkatram High-level Recently, a high-level committee has been committee for formed for the consultations on the creation of consultations on integrated triservice theatre commands. The theatre commands committee will examine all issues and find a way forward before a formal note on their creation is sent to the Cabinet Committee on Security. The Shekatkar committee (in 2015) had recommended the creation of 3 integrated theatre commands — northern for the China border, western for the Pakistan border, and southern for the maritime role.

(May, 2021)

Committee Headed by Purpose

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Advisory group to assist S Janakiraman The committee will assist the authority to the second Regulatory identify areas, guidelines, regulations and Review Authority (RRA returns. It will submit reports periodically 2.0) to RRA that will provide suggestions and recommendations.

RRA 2.0 was established in April 2021. The authority is to function for a period of one year. It will review the regulatory prescription internally. Also, it will examine and suggest changes required in the dissemination process of RBI instructions and circulars.

IFSCA’s expert Nilesh Shah The International Financial Services committee on Centres Authority, IFSCA has constituted Investment Funds an expert committee on Investment Funds. The Committee under the Chairmanship of Nilesh Shah, Managing Director of Kotak Mahindra Asset Management Co. Ltd, will recommend the road map for the funds industry in the International Financial Service Centres, IFSCs. The Committee comprises leaders from the Fund Management sector.

April, 2021

Committee Headed by Purpose

Regulations Review M Rajeshwar Rao The Reserve Bank of India Authority (RRA 2.0) (RBI) will set up a new Regulations Review Authority (RRA 2.0) from May 1, 2021, to review the regulations, circulars, reporting systems and compliance procedures of the central bank for streamlining them and making them more effective. The RRA will be set up for a period of one year unless the timeline is extended by the RBI.

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Asset Reconstruction Sudarshan Sen The Reserve Bank of India Companies (ARC) recently set up a committee to study about the Asset Reconstruction Companies (ARC) in the country. The committee will evaluate the role of ARCs in debt resolution and will review their business model.

The Committee will also review the role of ARC in stressed asset resolution under the IBC (Insolvency and Bankruptcy Code).

March 2021

Committee Headed by Purpose

Panel to Evaluate Bank Shyamala Gopinath The Reserve Bank of India (RBI) has set Applications up a “standing external advisory committee (SEAC)” on March 23, 2021. This panel will evaluate the applications for the universal banks and small finance banks (SFBs).

This committee comprises of five members.

February-2021

Committee Headed by Purpose

Expert Committee on Urban N. S. Vishwanathan The committee is being set in co-op Banks by RBI accordance with the provisions of the Banking Regulation (Amendment) Act, 2020. The act became applicable to the Primary or the Urban Co-operative Banks (UCBs) from June 26, 2020.

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Topic 4: List of Merger and Acquisition (Covered Feb to August)

Merger and Acquisition (February) Merger Company About DHFL was sent to bankruptcy court in December Acquisition of Diwan Housing Finance 2019 after the company defaulted to its lenders Corporation (DHFL) by Piramal Capital And on debt worth Rs 90,000 crore. Housing Finance Piramal’s plan is to recover Rs 37,250 crore over the next five years for DHFL’s lenders.

Merger and Acquisition (March) Merger Company About Wipro announced that it has signed an agreement to acquire Capco, a global management and Acquisition of global tech company technology consultancy providing digital, Capco by Wipro consulting and technology services to financial institutions in the Americas, Europe and the Asia Pacific for $1.45 billion.

Merger and Acquisition (April)

Merger Company About

Hitachi Ltd said on 31st March, it will buy U.S. software company GlobalLogic Inc for $9.6 billion, as the Japanese industrial conglomerate aims to expand from electronics hardware to digital services. Hitachi will buy US software developer GlobalLogic The acquisition is part of Hitachi’s ongoing business portfolio overhaul, which includes the $7 billion acquisition of ABB Ltd’s power grid business last year and a series of divestitures of its domestic hardware subsidiaries.

Merger and Acquisition (May)

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Merger Company About

Indian renewable energy company Adani Green Energy Ltd (ADNA.NS) said on 19th May it would buy SoftBank Group Corp-backed (9984.T) SB Energy Holdings Limited for an enterprise value of $3.5 billion. India's Adani Green will buy It would buy the 80% stake held by SoftBank Group Capital SoftBank-backed SB Energy Limited and the rest owned by Indian conglomerate Bharti Global Limited in a cash deal. The deal would allow Adani Green to achieve its targeted renewable portfolio of 25 gigawatts (GW) four years ahead of its expected timeline. Tata Digital has acquired a majority stake in online grocery BigBasket, a deal that pits the country’s largest Tata Digital acquired 64% stake conglomerate against entrenched e-commerce players. in BigBasket Regulatory filings showed that it has acquired around 64% stake in Supermarket Grocery Supplies that owns BigBasket.

Merger and Acquisition (June) Merger Company About

BharatPe has acquired a multi-brand loyalty platform, PAYBACK India, to help its 6 million offline merchants roll out BharatPe acquired loyalty platform rewards and loyalty programmes for customers. PAYBACK India The acquisition is expected to give an exit to American Express and ICICI Investments Strategic Fund, which hold 90% and 10% stake respectively in the entity. HDFC Bank all set to buy all Shares from parent company to group firm HDFC ERGO General Insurance Company Housing Development Finance Corporation (HDFC).These shares are HDFC Bank will buy stake in ‘Ergo worth Rs 1,906.43 crore This means that their total return is Rs General Insurance’ and ‘Borderless 536 per share. Softtech’ HDFC Bank along with its subsidiary HDFC Securities will buy 8,108 Compulsory Convertible Cumulative Preference Shares (CCCPS) face value of Rs 6.9 crore of Borderless Softtech at a premium of Rs 606.60 at Rs 6.16.60 per piece.

Merger and Acquisition (July)

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Merger Company About

Adani Group led by Gautam Adani has completed the takeover of ‘Mumbai International Airport’ from GVK group. Adani Group has taken over Adani Airport Holdings presently own a 74% stake in Mumbai Mumbai Airport International Airport. India is going to become world’s third largest aviation market by 2024. Microsoft has reached a deal to acquire RiskIQ, a San Francisco-based provider of cybersecurity services, including Microsoft acquired cybersecurity malware and spyware monitoring and mobile app security. firm RiskIQ Microsoft has valued the deal paying more than $500 million for RiskIQ. Edtech major Byju's has acquired US-based kids learning platform Epic in a $500 million cash-and-stock deal, making Byju's acquired US edtech firm Epic this its second-biggest acquisition after it bought brick-and- mortar coaching network Aakash Institute for close to $1 billion earlier this year. The Reserve Bank of India has accorded its approval to the Government of the Union Territory (UT) of Ladakh to acquire 8.23 per cent of the paid-up equity capital of Jammu and Kashmir Bank Ltd as on the date of enforcement of Jammu and Govt of UT of Ladakh will acquire Kashmir Reorganisation Act, 2019 ( October 31, 2019). 8.23% stake in J&K Bank This move follows the Government of Jammu and Kashmir’s October 30, 2020, Order regarding the transfer of 8.23 per cent shareholding (about 4.58 crore equity shares) in Jammu and Kashmir Bank as of October 31, 2019, to the UT of Ladakh.

Topic 5: List of Partnership/Agreement (Covered Feb to August) Partnership/Agreement (February) Partnership/Agreement Aim

To cooperate in software, artificial intelligence and cloud computing, to develop new consumer services and modernize internal operations. Ford Motor joins hand with Alphabet Inc’s Google The automaker will deploy Google artificial intelligence technology to improve the efficiency of vehicle development, supply chain and manufacturing operations.

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To explore potential synergies in several strategic areas of aviation services, including Airbus Signed an MoU with GMR Group maintenance, components, training, digital and airport services. The MoU was signed at Aero India 2021. Under the Prime Minister Street Vendor’s AtmaNibhar Nidhi (PM SVANidhi) Scheme. Ministry of Housing and Urban Affairs Under the MoU, it was decided to onboard the (MOHUA) and Zomato signed an MoU street food vendors on the food-tech platform of Zomato. This would help the street food vendors to access online the thousands of consumers. For creation of JATP–Center of Excellence (JATP – CoE) in the premises of IISc to expand the MoU between DRDO and IISc Bengaluru scope and objective of existing Joint Advanced Technology Program. To create awareness for energy-efficient pump sets and operational practices so as to adopt energy and resource-efficient approaches. MoU between Indian Council of Agricultural Research (ICAR) and Bureau Improving fuel efficiency and water resource use of Energy Efficiency (BEE) efficiency thereby reducing the cost of cultivation so as to increase farmers' income in harmony with strategies of "Per drop more crop" and "Doubling Farmers' income". On a Unified Payments Interface (UPI) multi- bank model. The partnership will provide PhonePe partners with Axis Bank PhonePe users with the option to create and use multiple UPI IDs with Axis Bank’s “@axl” handle. For implementation of the e-Challan within the jurisdiction of the Shillong Traffic Police (STP). Meghalaya police inked MoU with SBI The system has been integrated with VAHAN & SARATHI applications. To provide up to Rs 2 crore to the oil company's dealers.

PNB inked deal with Indian Oil The MoU would benefit dealers with credit facilities at lower interest rates, nil margin, and with minimum or zero collateral requirements through the PNB e-Dealer scheme.

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in order to establish a facility to manufacture the mobile components. Tata Electronics inked MoU with Tamil The project by the Tata Electronics will cost Rs Nadu 4684 crores. It will be established in Krishnagiri to manufacture the mechanical enclosures of mobile phones. in order to establish a paint manufacturing unit at Tamil Nadu signed an MoU with the Grasim Cheyyar. Industries It will be established with an investment of Rs 750 crore. to offer its customers the ‘Group SafeGuard’ insurance, a group health insurance policy. The ICICI Lombard partners with Flipkart ‘Group SafeGuard’ comes with daily cash benefits starting from Rs 500, and ‘Hospicash’ benefit for Flipkart consumers. for setting up a Centre of Excellence on Indian Oil Corporation (IOC) signed a pact Hydrogen (CoE-H). with Greenstat Norway National hydrogen mission to accelerate plans to generate the carbon-free fuel from renewables. to invest Rs 5,500 crore in Noida in the coming seven years to generate employment for thousands IKEA signed an MoU with UP govt of people in the state. The company will be developing shopping mall, hotel, offices and retail areas in 5 lakh sq ft.

Partnership/Agreement (March) Partnership/ Agreement Aim

The Goa state government has collaborated with IBM to provide free skills training to the youth. The Goa Government joined hands with collaboration aims to upskill 10,000 learners across 10 IBM institutions over one year in the state. IBM will work with the director of technical education, Goa. National Payments Corporation of India (NPCI) and SBI Payments have partnered to launch “RuPay SoftPoS” for NPCI partnered SBI Payments Indian merchants. The RuPay SoftPoS solution will provide a cost-effective acceptance infrastructure to retailers at a nominal cost.

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IBM announced a collaboration with Samagra Sikhsha Uttarakhand, the Government of Uttarakhand's education mission, to introduce the 'IBM STEM for Girls' IBM signed an MoU with Uttarakhand program in 130 secondary and higher secondary schools Government across five districts in the state. The program will advance the skills and careers of close to 25,600 students in Science, Technology, Engineering, and Math (STEM) fields.

SBI and Indian Oil Corporation Limited (IOCL) will sign the first Secured Overnight Financing Rate (SOFR) linked external commercial borrowing (ECB) deal. SBI and IOCL inked India’s First Libor Alternative Rate Deal The deal will be signed because the de facto international benchmark reference rate called the London Interbank Offered Rate (LIBOR) will no longer work as the benchmark after December 2021.

UNESCO has joined the USO India and Toonz Media Group over the water conservation awareness programme for students. UNESCO joined USO India and Toonz For the water conservation programme, the students have Media Group created the animation videos which will be unveiled on the occasion of World Water Day on March 22, 2021. It will be unveiled as a part of “H2Ooooh! – Waterwise Program” for the school students.

The “Labour Bureau”, which is an attached office under the Ministry of Labour & Employment had signed an agreement with the “Broadcast Engineering Consultants India Limited (BECIL)”, which is an enterprise under Ministry of Information and Broadcasting, have signed a Labour Ministry & BECIL signed an service level agreement in order to provide the technical agreement and manpower support to the Labour Bureau. This support from BECIL will help in conducting All India Surveys on Migrant Workers as well as the All-India Quarterly Establishment based Employment Survey (AQEES).

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a three-year MoU to offer financial assistance for the purchase of the company's range of small and light commercial vehicles. Tata Motors signed an MOU with SBI The collaboration with State Bank of India (SBI) will allow Tata Motors' commercial vehicle (CV) customers to avail of loans in a hassle-free manner as well as access SBI's unique technology-laden offerings.

Partnership/Agreement (April) Partnership/ Agreement Aim SBI has inked a loan agreement with State Bank of India, has raised $1 billion Japan Bank for International from Japan Bank for International Cooperation Cooperation (JBIC) to extend loans to supply chain of Japanese automobile industry in India.

SBI signed a loan agreement with JBIC, taking the total facility to $2 billion. It has inked similar agreement for $1 billion in October 2020, SBI said in a statement.

Bharti AXA Life and Fincare SFB joined Bharti Axa Life and Fincare Small Finance hands for bancassurance partnership Bank have joined hands for a bancassurance partnership under which the bank will sell insurance policies to its customers. Under the partnership, Bharti AXA Life Insurance will offer its comprehensive suite of life insurance products, including protection, savings and investment plans, to the customers of Fincare Small Finance Bank across its 747 branches and digital network presence across the country.

RBL Bank partnered with Mastercard RBL Bank and Mastercard have announced their partnership to launch a mobile-based consumer-friendly payment solution ‘Pay by Bank App’, a first-of-its-kind payment functionality in India.

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Indian Bank has signed an MoU with Indian Bank signed an MoU with Bharat BSNL Sanchar Nigam Limited to provide seamless telecom services to the bank at a competitive rate.

The bank is already using services of BSNL and Mahanagar Telephone Nigam Limited for its Wide Area Network across the country.

Partnership/Agreement (May) Partnership/ Agreement Aim ICICI Lombard tied up with to strengthen and automate the quality control processes. Microsoft The insurer will make use of Microsoft’s Azure Speech Services and Natural Language Processing (NLP) to screen its daily service calls made by customer service reps.

Bharti AXA Life signed a for the distribution of its life insurance products through the bancassurance pact with Shivalik bank’s pan-India network of branches. Small Finance Bank CESL-Ladakh signed an MoU State-owned Convergence Energy Services Ltd (CESL) which is a with Administration of Ladakh wholly owned subsidiary of Energy Efficiency Services Ltd (EESL) signed memorandum of understanding (MoU) with Administration of Ladakh to make Ladakh Carbon-neutral.

Bharti Airtel and TATA Group for implementing 5G network solutions for India, which will be partnered available for commercial development from January 2022. SBI General Insurance entered for distribution of non-life insurance Solution. into bancassurance tie-up with Under this strategic agreement, SBI General Insurance will offer IDFC First Bank insurance products such as health, personal accident, home, motor and travel along with the commercial line of insurance products such as property, marine and engineering insurance to the bank’s customers. SBI Card partnered with launched an exclusive co-branded contactless credit card named Fabindia “Fabindia SBI Card”. The card is designed with curated benefits and privileges to offer a rewarding shopping experience to its premium customers and comes in two variants — Fabindia SBI Card SELECT and Fabindia SBI Card.

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Jio and Google Cloud comprehensive, long-term strategic relationship with a goal of powering 5G in enterprise and consumer segments nationwide.

Partnership/Agreement (June) Partnership/ Agreement Aim ICICI Lombard tied up with to strengthen and automate the quality control processes. Microsoft The insurer will make use of Microsoft’s Azure Speech Services and Natural Language Processing (NLP) to screen its daily service calls made by customer service reps. Bharti AXA Life signed a for the distribution of its life insurance products through the bancassurance pact with bank’s pan-India network of branches. Shivalik Small Finance Bank CESL-Ladakh signed an MoU State-owned Convergence Energy Services Ltd (CESL) which with Administration of is a wholly owned subsidiary of Energy Efficiency Services Ladakh Ltd (EESL) signed memorandum of understanding (MoU) with Administration of Ladakh to make Ladakh Carbon-neutral.

Bharti Airtel and TATA Group for implementing 5G network solutions for India, which will partnered be available for commercial development from January 2022. SBI General Insurance entered for distribution of non-life insurance Solution. into bancassurance tie-up with Under this strategic agreement, SBI General Insurance will IDFC First Bank offer insurance products such as health, personal accident, home, motor and travel along with the commercial line of insurance products such as property, marine and engineering insurance to the bank’s customers. SBI Card partnered with launched an exclusive co-branded contactless credit card named Fabindia “Fabindia SBI Card”. The card is designed with curated benefits and privileges to offer a rewarding shopping experience to its premium customers and comes in two variants — Fabindia SBI Card SELECT and Fabindia SBI Card. Jio and Google Cloud comprehensive, long-term strategic relationship with a goal of powering 5G in enterprise and consumer segments nationwide.

Partnership/Agreement (July)

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Partnership/ Agreement Aim

MoU inked between AJNIFM Arun Jaitley National Institute of Financial Management and Microsoft (AJNIFM) and Microsoft have inked a Memorandum of Understanding (MoU) for building an Artificial Intelligence (AI) and emerging technologies Centre of Excellence at AJNIFM.

PhonePe partnered Flipkart to enable digitized pay-on-delivery service for the e-commerce major's orders. PhonePe's dynamic QR code solution will enable customers who earlier opted for 'cash on delivery' to pay digitally through any UPI app at the time of delivery.

Bajaj Allianz General a corporate agency agreement which will enable distribution of Insurance, Bank of India in Bajaj Allianz General Insurance’s products through the bank’s vast distribution tie-up network of 5,084 branches, 80 retail business centres and 60 SME city centres across the country.

Razorpay partnered with to launch ‘MandateHQ’ – a payment interface that will help card- Mastercard issuing banks to enable recurring payments for its customers. Razorpay, which is backed by Sequoia Capital, GIC, and others, aims to integrate MandateHQ with more than 50 banks in the next 12 months.

Max Bupa Health Insurance This partnership will help provide comprehensive health and Axis Bank entered a insurance solutions to Axis Bank’s employees and customers. Bancassurance partnership The tie-up will enable millions of Axis Bank customers across 4,500 plus branches to gain access to quality healthcare solutions through a range of health insurance products offered by Max Bupa. Axis Bank partnered NIIT IFBI to launch digital banking academy NIIT Institute of Finance Banking and Insurance (NIIT IFBI) and Axis Bank have launched a fintech professional programme to build future-ready professionals for the private sector lender. The programme offers graduates with zero to three years of experience an opportunity to join Axis Bank as a deputy manager (IT).

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Ladakh signed MoU with To make Ladakh organic, the administration of Ladakh on Sikkim 14th July signed an MoU with the Sikkim State Organic Certification Agency (SOCCA).

A tripartite MOU has been signed between Ladakh and SSOCA regarding the implementation of Prampragat Krishi Vikas Yojana and Mission Organic Development Initiative (MODI) in the Ladakh region with the aim to convert Ladakh into organic by 2025. IAHE signed pact with The Indian Academy of Highway Engineers (IAHE), under the University of New South Ministry of Road Transport & Highways (MORTH), has signed Wales an Agreement with University of New South Wales (UNSW), Australia for setting up a Centre for Advanced Transportation

Technology and Systems (CATTS) at IAHE, Noida.

Axis Bank signed an MoU with offering a defence service salary package under Axis bank’s Indian Army "Power Salute" initiative. The Defence service salary package will offer different benefits to all ranks of army officers. The benefits of the MoU will cover both serving Defence personnel as well Defence pensioners.

Kotak Mahindra Bank signed KMBL will offer its salary account proposition to all personnel of MoU with the Indian Navy the Indian Navy – both serving and retired. It also provides 'Special Education Benefit for Children & Additional Girl Child Benefit' that covers dependent children of up to 22 years in the event of an accident claim by the salary account holder. U GRO Capital & Bank of for co-lending to the micro, small and medium enterprise Baroda in tie-up (MSME) sector. Under the co-lending programme Pratham, Bank of Baroda and U GRO will together disburse loans worth Rs 1,000

crore to MSMEs. The loan amount ranges from ₹50 lakh to ₹2.5 crores to be offered at an interest rate starting from 8% with a maximum tenure of 120 months.

BIAL signed a deal with IBM Bangalore International Airport Limited (BIAL), has signed a ten-year partnership with the company IBM to set up the ‘Airport

in a Box’ platform. The partnership is designed to help Bangalore International Airport Limited (BIAL) improve its productivity, automate its information technology services, increase operational flexibility to handle future growth in passenger traffic and reduce costs.

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August 2021 Partnership/ Agreement Aim

Indian Bank signed an MoU with SINE, for funding Start-ups and MSMEs. IIT Bombay Indian Bank, entered into an MOU with Society for Innovation and Entrepreneurship (SINE), IIT Bombay an initiative of Indian Institute of Technology, Bombay for extending exclusive credit facility to Start-ups and MSMEs. ICICI Prudential Life tied up with NPCI to provide a Unified Payments Interface Autopay facility to its customers. The UPI Autopay e-mandate can be activated by customers by using their smartphones to make regular renewal premium payments in a paperless format. SBI General partnered with SahiPay to increase insurance penetration in the rural markets. SahiPay, the fastest growing tech-enabled financial inclusion platform of Manipal Business Solutions, provides digital and financial services to customers in semi-urban and rural India. Indian Navy has inked an MoU with the to initiate ‘Honour FIRST’, a premium banking solution for Infrastructure Development Finance serving personnel and veterans of the Indian Navy. Company (IDFC) FIRST Bank With zero – balance salary account feature, Honour FIRST account holders will receive up to 5 per cent interest per annum and a net banking and customised mobile app. Indian Bank signed an MoU with as one of the banking partners of the Paralympic Games Paralympic Committee of India (PCI) which commenced from August 24 in Tokyo, Japan. The President of the Paralympic Committee of India is Deepa Malik. & HDFC Bank tie-up to build comprehensive solutions across payment gateway, point of sale machines and credit products. This includes Paytm Postpaid which is a Buy Now Pay Later (BNPL) solution, Eazy EMI and Flexi Pay. The partnership will also deliver enhanced SmartHub solutions to the market. HDFC Bank SmartHub solutions is an integrated platform offering merchants a one-stop solution shop for all their business needs payments.

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Intel has collaborated with CBSE, announced the launch of the AI For All initiative with the Ministry of Education purpose of creating a basic understanding of artificial intelligence (AI) for everyone in India. Based on Intel’s AI For Citizens program, AI For All is a 4- hour, self-paced learning program that demystifies AI in an inclusive manner. Haryana govt signed an MoU with to create a pathway for Indian MSMEs’ products to move Walmart Vriddhi and ‘Haqdarshak’ to the international markets. To promote MSMEs apart from large industries, many important concessions have been given to investors in ‘Haryana Enterprises and Employment Policy-2020’. BRICS signed a deal with ISRO Brazil, Russia, India, China and South Africa (BRICS) signed an agreement for cooperation in remote sensing satellite data sharing, according to the Indian Space Research Organisation (ISRO). IIM Ahmedabad has partnered with to launch a Centre for Digital Transformation (CDT). The Centre aspires to become a knowledge hub for academia, policymaking, and the private sector by facilitating cutting- edge research on digital transformation and innovation.

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Topic 6: List of loan agreement for India from different organizations 2021 (Topic Feb to August)

Loan (August, 2021) Loan Organization/Bank Purpose Amount

The Government of India, the Central Water Commission, government representatives from 10 participating World Bank $250 million states and the World Bank signed a $250 million project for long-term dam safety program and improving the safety and performance of existing dams across various states of India. ADB has approved a USD 300 million loans as additional financing for the Asian Development USD 300 ongoing Maharashtra Rural Bank million Connectivity Improvement Project for upgrading rural roads and connecting remote areas with markets. Asian Development USD 500 India has signed a USD 500 million Bank million loans agreement with the ADB in

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order to expand metro rail network in Bengaluru.

Metro Rail Network in Bengaluru will be expanded with the construction of two new metro lines of 56 kilometers.

Loan (July, 2021)

Organization/Bank Loan Amount Purpose

to support India's informal working class to overcome the current pandemic distress. $500 million Of the USD 500 million commitment, USD 112.50 million will be financed by its concessionary World Bank (about Rs 3,717.28 lending arm International Development crore) Association and USD 387.50 million will be a loan from International Bank for Reconstruction and Development (IBRD).

Loan (June, 2021)

Organization/Bank Loan Amount Purpose

Asian Development Bank USD 2.5 million A project readiness financing (PRF) loan to (ADB) (approx Rs 18.23 Upgrade Road Infrastructure In Sikkim crore)

Asian Development Bank USD 484 million to improve transport connectivity and facilitate (ADB) industrial development in the Chennai– Kanyakumari Industrial Corridor (CKIC) in the state of Tamil Nadu

World Bank USD 500 million A Raising and Accelerating Micro, Small and Medium Enterprise (MSME) Performance (RAMP) Program to help boost India’s MSME sector

World Bank USD 32 million Mizoram Health Systems Strengthening Project for improving healthcare services in Mizoram

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World Bank USD 125 million to support Kerala’s preparedness against natural disasters, climate change impacts, disease outbreaks and pandemics

World Bank USD 250 million for Initiatives of ‘Supporting Andhra’s Learning (Rs 1,860 Crore) Transformation’ (SALT) Programme in Andhra Pradesh

Loan (April, 2021)

Organization/Bank Loan Amount Purpose

World Bank USD 32 million to improve management capacity and quality of health services in Mizoram.

The project titled “Mizoram Health Systems Strengthening Project” will strengthen the governance and the management structure of the Mizoram Health department and its subsidiaries

World Bank, Asian USD 300 million approved about Rs 2,190 crore for canal- Infrastructure Investment based drinking water projects in Bank Punjab. The project is aimed at ensuring quality drinking water and minimise water losses for Amritsar and Ludhiana. The entire project will be co-financed by IBRD (World Bank) – USD 105 million, Asian Infrastructure Investment Bank – USD 105 million and the Punjab government – USD 90 million.

Asian Development Bank 484 million USD for CKIC (Chennai-Kanyakumari Industrial Corridor) in Tamil Nadu. The project will upgrade 590 km of state highways in the CKIC influence areas. The Climate Change adaptation measures are to be incorporated in the highway upgrades. The project is to strengthen road safety programmes through advanced technologies for road monitoring.

Asian Development Bank USD 1.5 billion ADB has provided USD 1.5 billion to India to deal with the COVID-19 pandemic. The institution had announced a package of USD 20 billion in April 2020 to provide

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financial support to 26 countries to help fight the pandemic.

Loan (March 2021)

Organization/Bank Loan Amount Purpose

World Bank $100 million The World Bank plans to introduce a $100-million credit guarantee scheme to boost India’s rooftop solar programme, which has not gained enough traction. The scheme will allow micro, small, and medium enterprises (MSMEs) to avail concessional debt financing for setting up rooftop solar units.

The World Bank scheme, along with State Bank of India (SBI) and the MSME ministry to accelerate adoption of rooftop solar units, will help MSMEs access credit of around $1 billion.

Loan (February, 2021)

Organization/Bank Loan Amount Purpose

Export-Import Bank of India $400 Million It will provide the fund for the Greater Male (Exim Bank) Connectivity Project.

The Greater Male Connectivity project is the Male to Thilafushi Link project in Maldives.

New Development Bank (NDB) $100 Million to invest into the NIIF Fund of Funds (FoF). NIIF Fund of Funds (FoF): The FoF was established in the year 2018. It was established with the objective of providing the access of the homegrown Indian private equity fund managers to the institutional investor that operates at scale with focus on India. The FOF has made commitments to four funds till

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date. The aggregate commitment stands over ₹2,750 crore.

World Bank $100 million Indian Govt and Chhattisgarh Govt has signed a loan for CHIRAAG (Chhattisgarh Inclusive Rural and Accelerated Agriculture Growth) project. Purpose: Develop sustainable production systems that allow tribal households in remote areas of Chhattisgarh to practice round-the-year production of diversified and nutritious food.

Asian Infrastructure $304 million Assam Intra-State Transmission Investment Bank (AIIB) System Enhancement Project to improve reliability, capacity and security of the power transmission network in the State of Assam. World Bank 68 million project to enhance the governance of schools dollars across Nagaland as well as to improve teaching practices and learning environments in select schools. The “Nagaland: Enhancing Classroom Teaching and Resources Project” will improve classroom instruction; create opportunities for the professional development of teachers.

Topic 7: Union Budget 2021-22: Highlights Union Finance Minister, Nirmala Sitharaman is presenting the Union Budget 2021 for the 3rd time in a row. The Union Budget is the yearly financial report estimating the income and expenditure presented to outline future policies to be adopted by the government for sustainable growth and development. Union Budget 2021 ”Faith is the bird that feels the light and sings when the dawn is still dark”. - Rabindranath Tagore

(Fireflies – A Collection of Aphorisms)

• 1st Paperless Budget

• On a Tab Made in India

According to Speech of FM Nirmala Sitharaman

COVID Relief

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• The Prime Minister announced the Pradhan Mantri Garib Kalyan Yojana, valued at 2.76 lakh crores

• free food grain to 800 million people,

• free cooking gas for 80 million families for months,

• and cash directly to over 400 million farmers, women, elderly, the poor and the needy. Total financial impact of all AtmaNirbhar Bharat packages including measures taken by RBI was estimated to about `27.1 lakh crores which amounts to more than 13% of GDP.

• PART A : In Part A, I wish to lay a vision for AtmaNirbhar Bharat.

♦Budget Proposals 2021-22

Pillars

1)Health and Wellbeing

2)Physical & Financial Capital, and Infrastructure

3)Inclusive Development for Aspirational India

4)Reinvigorating Human Capital

5)Innovation and R&D

6)Minimum Government and Maximum Governance

♦1. HEALTH SYSTEM

• PM AtmaNirbhar Swasth Bharat Yojana: outlay of about 64,180 crores over 6 years.

• Support for 17,788 rural and 11,024 urban Health and Wellness Centers.

• Setting up of 15 Health Emergency Operation Centers and 2 mobile hospitals.

Universal Coverage of Water

• The Jal Jeevan Mission (Urban) = 86 crores household tap connections

• 5 years, with an outlay of `2,87,000 crores.

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Swachch Bharat, Swasth Bharat

• The Urban Swachh Bharat Mission 2.0 = 1,41,678 crores over a period of 5 years from 2021-2026.

Clean Air

• 2,217 crores

Vaccine

• Rs. 35,000 crores for Covid-19 vaccine

Note: OVERALL outlay for Health and Wellbeing is Rs. 2,23,846 crores (increase of 137%)

♦2. Physical and Financial Capital and Infrastructure

AtmaNirbhar Bharat – Production Linked Incentive scheme (PLI)

• AtmaNirbhar Bharat have been announced for 13 sectors.

• For this, the government has committed nearly Rs. 1.97 lakh crores, over 5 years starting FY 2021-22 (Manufacturing Hub)

Textiles

• A scheme of Mega Investment Textiles Parks (MITRA)

• 7 Textile Parks will be established over 3 years

Infrastructure financing – Development Financial Institution (DFI)

• Government to set up a DFI

• A sum of Rs. 20,000 crores to capitalise this institution

• Lending portfolio of at least Rs. 5 lakh crores for this DFI in three years time

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National Monetisation Pipeline of potential brownfield infrastructure assets will be launched

• NHAI & PGCIL have sponsored one InvIT each

• 5 operational roads with an estimated enterprise value of 5,000 crores are being transferred to the NHAI InvIT.

• Transmission assets of a value of Rs. 7,000 crores will be transferred to the PGCIL InvIT

• InvIT = Infrastructure Investment Trusts

• PGCIL = Power Grid Corporation of India

Capital Budget

• Capital Expenditure = Rs.5.54 lakh crore (+34.5% vs. FY21 BE)

• FY21 = Rs.4.39 lakh crore

• Sum of more than Rs. 44,000 crores in the Budget head of the Department of Economic Affairs

• More than Rs. 2 lakh crores to States and Autonomous Bodies for their Capital Expenditure

Roads & Highway Infrastructure

• More than 13,000 km length of roads of which 3,800 kms have been constructed

• By March 2022, another 8,500 kms and complete an additional 11,000 kms of national highway corridors.

• 3,500 km corridor in Tamil Nadu (Madurai-Kollam corridor, Chittoor- Thatchur corridor)

• 1,100 km in Kerala at investment of Rs 65,000 cr (MumbaiKanyakumari corridor)

• 675 km in West Bengal at a cost of Rs 95,000 cr (upgradation of existing road-Kolkata – Siliguri.)

• 1,300 km in Assam in the next 3 years

Railway Infrastructure

• National Rail Plan for India – 2030

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• 100% electrification of Broad-Gauge routes will be completed by December, 2023

• 1,10,055 crores for Railways of which Rs. 1,07,100 crores is for capital expenditure.

Urban Infrastructure

• 18000 cr = Expand Transport Services

• ‘MetroLite’ and ‘MetroNeo’ technologies in Tier- II metros.

Petroleum & Natural Gas

• Ujjwala Scheme= Covered 8 cr households and will be extended to 1 cr more beneficiaries

• City Gas Distribution network = add 100 more districts in next 3 years.

• A gas pipeline project will be taken up in Union Territory of Jammu & Kashmir.

Financial Capital

• 1,000 crores = Solar Energy Corporation of India

• 1,500 crores = Indian Renewable Energy Development Agency

Increasing FDI in Insurance Sector

• Insurance Act, 1938 = FDI limit from 49% to 74%

• Stressed Asset Resolution by setting up a New Structure

Recapitalization of PSBs

• Recapitalization of 20,000 crores for bank is proposed in 2021-22

Deposit Insurance

• DICGC Act, 1961 = Rs.1 lakh to Rs.5 lakh

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• Revised definition for NBFCs with minimum asset size of Rs.100 crores, minimum loan size eligible for debt recovery under (SARFAESI) Act, 2002 is proposed to be reduced from the existing level of Rs. 50 lakhs to Rs.20 lakhs.

Company matters

• Revise the definition under the Companies Act, 2013 for Small Companies by increasing their thresholds for Paid up capital from not exceeding 50 Lakh to not exceeding Rs. 2 Crore and turnover from not exceeding Rs. 2 Crore to not exceeding 20 Crore.

Disinvestment

• Target for FY22 = Rs.1.75 lakh cr

• Disinvestment will be completed by 2021-22:

• BPCL, Air India, Shipping Corporation of India, Container Corporation of India, IDBI Bank, BEML, Pawan Hans, Neelachal Ispat Nigam limited

• Other than IDBI Bank, Privatization of two Public Sector Banks and one General Insurance company in the year 2021-22

• IPO of LIC

♦3. Inclusive Development for Aspirational India

Agriculture

• MSP = 1.5 times the cost of production across all commodities

• Farmers benefited from MSP in Paddy & Wheat = 54 cr

• Amount paid to Farmers for Wheat in FY21 = Rs.75060 cr

• Ans for Paddy in FY21 = 1.72 cr

• For Pulses = Rs. 10530 cr

• Under SVAMITVA scheme = about 1.80 lakh property-owners in 1,241 villages have been provided cards

• Agricultural credit target = Rs.16.5 lakh crores in FY22

• Allocation to the Rural Infrastructure Development Fund from Rs. 30,000 crores to 40,000 crores.

• Micro Irrigation Fund= Rs. 5,000 crores , created under NABARD

• ‘Operation Green Scheme’ = Tomatoes, onions, and potatoes, will be enlarged to include 22 perishable products.

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Fisheries

• 5 major fishing harbours – Kochi, Chennai, Visakhapatnam, Paradip, and Petuaghat

Migrants Workers

• Under One Nation, One Ration

• 69 crores beneficiaries – that’s a total of 86% beneficiaries covered

• 32 states and UTs

Financial Inclusion

• Reduce the margin money requirement from 25% to 15%, and to also include loans for activities allied to agriculture.

• MSME sector allocation to be doubled = 15,700 crores in FY22

♦4. Reinvigorating Human Capital

• The National Education Policy (NEP) announced recently has had good reception

• 100 new Sainik Schools will be set up

• Set up a Central University in Leh.

• A target of establishing 750 Eklavya model residential schools in our tribal areas

♦5. Innovation and R&D

• Worked out the modalities and the NRF outlay will be of 50,000 crores, over 5 year

• 1500 crore for a scheme to boost Digital Payment

• Gaganyaan mission = 4 Indian astronauts are being trained on Generic Space Flight aspects, in Russia.

• The first unmanned launch is slated for December 2021

• Deep Ocean Mission = more than Rs. 4,000 crores, over five years

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♦6. Minimum Government, Maximum Governance

• The forthcoming Census could be the first digital census in the history of India allocated 3,768 crores in the year 2021-2022.

• 300 crores = Govt of Goa as grant for celebration of 50 years of Independence from the Portugues

• 1000 cr = Bengal, Assam Tea workers

Fiscal Position

• FY21 fiscal deficit at 5% of GDP

• FY21 Gross Expenditure = Rs.34.5 lakh cr

• FY21 Capital Expenditure = Rs.4.39 lakh cr

• FY22 fiscal deficit target = 6.8% of GD

• FY22 Gross Expenditure = Rs. 34.83 lakh cr

• FY22 Capital Expenditure = Rs.5.54 lakh cr

• Market borrowing in Fy22 = Rs.12 lakh cr Note: Hope to get Fiscal Deficit by FY26 = below 4.5%

Part B

Relief to Senior Citizens

• Pensioners over 75 years of age are exempt from filling returns Exemption from Audit

• Turnover exceeds Rs. 5 crore increased to Rs.10 crore if 95% transaction in digital form

highlighted, bad loan ratio of banks Topic 8: RBI Annual Report could rise to 13.5% under baseline stress scenario by 2021 September 2021. Reserve Bank of India (RBI) published its • Provision Coverage Ratio (PCR) of annual report and highlights “asset banks improved from 66.6% in quality of banks and their preparedness March 2020 to 75.5 % by requires close monitoring for higher December 2020, because of prudent provisioning for upcoming quarters. provisioning by banks above regulatory prescriptions on accounts • RBI in its semi-annual financial availing moratorium and undergoing stability report earlier restructuring.

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• Capital to risk-weighted assets ratio Banks wrote off Rs 62,000 cr loans of (CRAR) of banks increased to top 100 willful defaulters: RBI 15.9% by December 2020, in March it was 14.8%. Banks have written off almost Rs 62,000 crore of loans of top 100 wilful • In its report, RBI cautioned “banks defaulters as of March 2020, with Jatin being lenders will have to provide Mehta’s Winsome Diamonds & true picture of bad loans after Jewellery topping the list at Rs 3,098 Supreme Court lifted interim stay on classifying non-performing crores. assets (NPA) in March 2021. IRDAI issues guidelines on Standard • According to it, waiver of compound Vector-Borne Disease health policy interest on all loan accounts opted for In order to convince public for getting moratorium during March-August health insurance coverage to 2020 would put stress on financial health of banks. specified Vector-Borne Diseases, the Insurance Regulatory and • Gross NPA ratio of banks decreased Development Authority of India from 8.2% in March 2020 to 6.8% (Irdai) has encouraged all general and in December 2020. health insurers to offer Standard Vector- • Gross NPA ratio for non-banking Borne Disease health policy “Mashak financial institutions (NBFCs) Rakshak”. This health policy can increased from 6.8% in march to preferably be available by 1 April 5.7% in December 2020. 2021. • Capital adequacy ratio of NBFCs Vector-borne diseases generally happen increased from 24.8% in from an infection transmitted to humans December 2020 from 23.7% in and other animals by blood-feeding March. insects like mosquitoes, ticks, etc. For instance, vector-borne diseases can Topic 9: Banking & Financial include Dengue fever, Malaria, etc. news (Feb to August) Policy framework Feb 2021 The minimum sum insured under Standard Product shall be ₹10,000 Govt pegs FY21 fiscal deficit at 9.5% of wherein the amount can be increased in GDP the multiples of ₹10,0000 and maximum Finance Minister Nirmala Sitharaman limit can go up to ₹2 lakh. Besides, the said on 1 Feb the fiscal deficit for FY21 minimum entry age shall be 18 years for has been pegged at 9.5 per cent of the principal insured and maximum age at GDP and will come down to 6.8 per cent entry shall not be less than 65 years for in FY22. The fiscal deficit will reach all the insured members including below 4.5 per cent by FY26. principal insured. Sitharaman said while gross expenditure PayPal to Stop Domestic Payment is seen at Rs 34.5 lakh crore, the capital Services from 1 April 2021 expenditure is expected to be Rs 4.39 lakh crore in FY21.

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The American Digital payment tribute, ‘NayaNazariya’ to shed light on solutions provider PayPal announced the selfless devotion of caregivers that it will stop offering the domestic everywhere. payment services within India Govt allocates Rs16000 crore for beginning from April 1, 2021. 2021-22: PMFBY RBI to adopt “One Nation One The Central government has allocated Ombudsman” approach Rupees 16,000 crores for the Pradhan The Reserve Bank of India (RBI) has Mantri Fasal Bima Yojana (PMFBY) for announced that it will integrate the the upcoming fiscal year 2021-22. consumer grievances redressal under This allocation was done in order to a single ombudsman as opposed to the boost the safety of farmers’ crops. The three grievance redressal schemes amount will also ensure that maximum working at present. benefit of crop insurance reaches to the There are dedicated ombudsman farmers. schemes for the consumer grievance Govt Rs. 1050 crore budget has been redressal in the banking, non-bank allocated Sub Mission on Agricultural finance companies and digital Mechanization Scheme transactions. In the Union Budget 2021, Rs. 1050 launches ‘FedFirst’ crore budget has been allocated for savings account scheme for children Sub Mission on Agricultural Federal Bank has announced the Mechanization (SMAM) for the launch of “FedFirst”, a special savings financial year 2021-2022. account scheme for children below 18 About Scheme: The SMAM scheme was years of age. The account holder is launched in the year 2014-15. The provided with a FedFirst contactless scheme was launched by the government Debit Card with a daily cash withdrawal of India with the aim of ‘reaching the limit of ₹2,500 and POS/e-com limit of unreached’. The scheme seeks to reach to ₹10,000. the unreached by making the farm Bharti AXA General Insurance machines accessible and affordable for launches #EkNayaNazariya Campaign the small and marginal farmers (SMFs). Bharti AXA General Insurance has Projects amounting to ₹78,910 crores launched a new campaign called grounded under AMRUT #EkNayaNazariya by asking everyone Atal Mission for Rejuvenation and to express their gratitude with the Urban Transformation (AMRUT) was #IssJungMeinHumSangHai statement. launched on 25 June 2015 in 500 The aim of this campaign is to selected cities across the country. The acknowledge the caregivers who are Mission focuses on the development of supporting cancer survivors. And for this basic urban infrastructure in the sectors Bharti AXA General Insurance of water supply; sewerage and septage collaborated with spoken word poet and management; storm water drainage; caregiver, Priya Malik for a poignant

Best Online Test Series Site for Bank | JAIIB | CAIIB | RRB NTPC | SSC and State Government 76 Jobs ambitiousbaba.com Online Test Series non-motorised urban transport and companies, followed by Haryana, Delhi, development of green spaces and parks. Tamil Nadu, Telangana and Karnataka. Following are the achievements of under Reserve AMRUT scheme: Bank of India's regulatory purview • Projects amounting to ₹78,910 The Reserve Bank of India (RBI) has crores have been grounded. brought State Bank of Sikkim under • Work worth ₹47,703 crores have its regulatory purview. The bank, been carried out including established five years before Sikkim completed projects worth acceded to India in 1973, provides ₹16,449 crores. treasury operations for the state • 97 lakh water tap connection and government. It only operates within 62 lakh sewer household Sikkim and is wholly-owned by the state connections have been provided government. under AMRUT and in LIC launches new Bima Jyoti plan convergence with other scheme. • Sewer Treatment Plants (STPs) of Life Insurance Corporation of India capacity 1,090 MLD (Million Litre (LIC) has launched a non-linked, non- per Day) have been developed participating, individual savings plan against the target of 6,000 MLD. called Bima Jyoti. ICICI Lombard launches Corporate The plan offers a combination of India Risk Index protections and savings. While it will provide life cover in case of unfortunate Private general insurer ICICI Lombard death of the policyholder, it also provides has launched the ‘Corporate India guaranteed lumpsump payment at Risk Index’. This is intended to be a maturity. unified, standardised corporate risk index that spans industries and The minimum entry age for Bima Jyoti is companies. 90 days, while the maximum is 60 years. This will help companies understand RBI ropes in Punjabi rapper for the level of risk that their business is awareness campaign on cyber fraud facing and also assist in developing a As cyber frauds continue to increase, successful risk aversion plan. the Reserve Bank of India, has India recorded $1422 million FDI undertaken an unusual measure to inflow from UK in 2019-20 spread awareness. The RBI has roped in Punjabi singer-rapper Viruss in its The FDI inflow from the UK to India public awareness campaign. has increased from $898 million in 2015- 16 to $1,422 million in 2019-20, China Surpasses US to become India’s according to Grant Thornton Bharat’s top trade partner in 2020 Britain Meets India report released on China has regained its position as the 17th Feb. top trading partner of India in 2020, Maharashtra has come out as the top which was held by the United States, investment destination for UK since 2018-19. The two-way trade

Best Online Test Series Site for Bank | JAIIB | CAIIB | RRB NTPC | SSC and State Government 77 Jobs ambitiousbaba.com Online Test Series between India and China stood at The State Bank of India (SBI) Mutual $77.7 billion in 2020 despite the conflict Funds has launched its first overseas along the Line of Actual Control (LAC) offering on 1 March 2021. The fund and the rising anti-China sentiment. titled SBI International Access — US Equity FOF is an open-ended fund of The India-US bilateral trade stood at funds scheme investing in mutual fund $75.9 billion, according to provisional scheme/ETFs that invest in US markets, data from the commerce ministry. which are domiciled overseas. Meanwhile, the UAE continues to remain India’s third-biggest trading partner. EPFO retains interest rate for 2020-21 at 8.5% SBI joins JPMorgan’s blockchain payments network The Central Board of Trustees of retirement fund body Employees’ State Bank of India has tied up with Provident Fund Organisation (EPFO) JPMorgan to use the US bank’s will keep the interest rate for the blockchain technology to speed up financial year 2020-21 unchanged at overseas transactions. 8.5 per cent. The tie-up is expected to reduce SBI India attracted total FDI inflow of US$ customers’ transaction costs and time 67.54 billion during April to taken for payments. SBI has joined December 2020 Liink, a new blockchain-based interbank data network developed by India has attracted total FDI inflow of JPMorgan. By integrating the US$ 67.54 billion during April to technology, the bank expects to reduce December 2020. It is the highest ever transaction costs and improve cross- for the first ninth months of a financial border payments for its customers. year and 22% higher as compared to the first ninth months of 2019-20 (US$ 55.14 March 2021 billion). Fino Payments Bank upgraded to FDI equity inflow grew by 40% in the scheduled commercial bank status first 9 months of F.Y. 2020-21 (US$ 51.47 Reserve Bank of India has notified billion) compared to the year ago period that it has included Fino Payments (US$ 36.77 billion). Bank in the Second Schedule of the HDFC ERGO launched Business Kisht Reserve Bank of India Act, 1934. Suraksha cover All banks which are included in the HDFC ERGO General Insurance has Second Schedule to the Reserve Bank of launched the “Business Kisht India Act, 1934 are Scheduled Banks. Suraksha” cover. It is a unique cover These banks comprise Scheduled which was launched with the aim of Commercial Banks and Scheduled Co- protecting the balance sheet of Micro operative Banks. finance Institutions (MFIs), financial SBI Mutual Funds Launched First institutions and banks if any catastrophe Overseas Fund or natural disaster occurs.

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India FDI Apr-Sep 2020: Singapore SBI maintained the top remitter bank by with $8.30 Billion Topped the List, US recording highest UPI transaction 2nd Biggest Source volume which accounted for nearly Rupees 640 million. SBI has also The US has emerged as the second emerged as the largest issuer of debit biggest source of foreign direct cards. investment (FDI) into India, replacing Mauritius, during the first half of the RBI removed PCA restrictions on IDBI current financial year, according to data Bank of the commerce and industry ministry. The Reserve Bank of India (RBI) has During April-September 2020, India removed IDBI Bank from restrictions attracted FDI worth $7.12 billion from placed on it due to its poor capital, asset the US and $2 billion from Mauritius. quality and leverage position four Singapore with $8.30 billion foreign years ago. inflows continued to be the top source of That the decision was taken in a review FDI for India in April-September 2020- by the central bank's internal Board of 21. Financial Supervision (BFS) in a meeting SEBI canceled Sahara India Financial on February 28. Corp’s registration as sub-broker Axis Bank launched “Wear N Pay” Markets regulator Sebi has cancelled contactless payment wearable the certificate of registration of devices Sahara India Financial Corporation Axis Bank has launched a range of Ltd as a sub-broker citing its failure to wearable contactless payment fulfil the “fit and proper” criteria. devices under the brand Wear ‘N’ Pay. HDFC Bank launched SmartUp Unnati These devices come in different forms of programme wearables like a band, key chain and watch loop and are available starting at The HDFC Bank has launched the Rs 750. “SmartUp Unnati mentoring Programme”. This programme was NITI Aayog submitted the first list of launched to provide its support to the 12 PSUs for Privatisation women entrepreneurs. This The government’s think tank, NITI programme was launched on the Aayog has submitted the first list occasion of International Women’s Day. comprising of 12 Public Sector MeitY released the list of “Digital Undertakings that will be privatized Payment Scorecard” under the centre’s privatisation drive. The Ministry of Electronics & The list submitted by the NITI Aayog Information Technology (MeitY) has includes the PSUs in strategic sectors. released the list of “Digital Payment This list will now be reviewed by Scorecard”. In the list, the State Bank of Department of Investment and Public India (SBI) has topped for the third Asset Management (DIPAM) and Core consecutive months. Group of Secretaries on Divestment

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(CGD) which is headed by cabinet 2020, it infused Rs 5,500 crore in secretary. Punjab and Sind Bank. Govt will sell 15% stake in Rail Vikas Nigam Ltd via OFS RBI has decided to open up RTGS, NEFT facilities for payment system The government on 24th March said it operators will dilute 15 per cent stake in Rail Vikas Nigam Ltd via an offer for sale to In a major move in the online payments raise nearly Rs 750 crore. Govt. would segments, the Reserve Bank of India divest 10% equity with a 5% Green Shoe (RBI) has decided to allow payment option. system operators to take direct membership of Centralised Payment About RVNL: RVNL was incorporated as Systems (CPS), such as RTGS and a 100 per cent owned PSU of the Ministry NEFT. Membership in Centralised of Railways on January 2003. Payment Systems (CPS) RTGS and NEFT for entities other than banks are so far April 2021 limited to banks, with a few exceptions, such as specialised entities like clearing Centre has proposed up to 25% tax corporations and select development concession on purchase of new financial institutions. vehicles

The Ministry of Road, Transport, and RBI has increased WMA limits for the Highways has proposed a concession of 25% in road tax against the scrappage State Governments/UTs certificate of personal vehicles and 15% for transport The Reserve Bank of India has vehicles. As a part of the newly increased the limit for Way and Means introduced vehicle scrappage policy, this Advances (WMA) for the State rule is proposed to come into effect Governments/UTs from Rs. 32,225 from October 1st, 2021. crore (fixed in February 2016) to Rs. 47,010 crore based on the Government has announced Rs recommendation of a committee headed 14,500 crore capital infusion in by Shri Sudhir Shrivastava. This represents an increase of about 46%. 4 PSBs RBI has extended the enhanced interim The Central Government has WMA limit of ₹ 51,560 crores (a 60 per announced to infuse Rs 14,500 crore cent increase in the current limits in four state-owned lenders namely allowed by the Reserve Bank during the Central Bank of India, Indian Overseas last fiscal to help states/UTs to tide over Bank, Bank of India and UCO Bank in the difficulties faced by them during the 2020-21, by issuing non-interest- pandemic) for a further period of six bearing bonds to these banks. This months i.e., from April 1, 2021, up to infusion will complete September 30, 2021. the government’s total capital infusion of Rs 20,000 crore in public RBI has enhanced maximum balance sector banks for the current financial year 2020-21. Earlier in December limit per account in Payments Banks

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The Reserve Bank of India has Aceware has launched first neobank enhanced the limit of maximum in Kerala balance at end of the day maintained in Payments Bank from Rs 1 lakh to Rs Aceware FinTech Services, a leading 2 lakh per individual customer. The fintech services company in Kerala, extant “Guidelines for Licensing of has launched the state’s first neobank, Payments Banks” issued on November Ace Money Neobank, in partnership 27, 2014, allow payments banks to with YES Bank and ICICI Bank. In the first hold a maximum balance of ₹ 1 lakh phase, start-ups, traders and business per individual customer. entities can open current accounts with the neobank.

SBI MF has become first mutual fund RBI has restricted American Express company to cross Rs 5 lakh crore Banking Corp, Diners Club International Ltd from adding new AAUM customers

SBI Funds Management Pvt. Ltd has Reserve Bank of India has imposed informed that it has become the first restrictions on American Express mutual fund house in India to cross Banking Corp and Diners Club the Rs. 5 lakh crore average assets International Limited from adding under management (AAUM) mark. new customers to their card networks from 1st of next month. Ghaziabad has issued India’s first municipal green bonds RBI has allowed commercial banks to pay up to 50% of pre-Covid dividends Ghaziabad Nagar Nigam (GNN) on 9th Arpil announced successfully raising The Reserve Bank of India (RBI) has and listing India’s first Green allowed commercial banks to pay Municipal bond issue. GNN raised dividends on equity shares for FY21, ₹150 crore at a cost of 8.1 per cent. from the profits for the fiscal ended Money will be used clean up dirty water March 31, 2021, subject to certain by setting up a tertiary water treatment conditions and limits. The new plant and supply piped water through notification of RBI allows commercial water-meters to places like Sahibabad. banks to pay dividends not more than 50 per cent of the amount determined as per the dividend payout ratio Citigroup will exit consumer banking prescribed. This means that banks may business in India pay dividends up to 50% of what they paid before the Covid scenario. Citigroup on 16th April Announced it will exit its retail banking business in RBI has capped the Tenure of Private India and 12 other countries, choosing Banks MD & CEO at 15 Years to deploy its capital and resources in investments that offer better returns and The Reserve Bank of India (RBI) has growth. The move will see the bank also capped the tenure of Managing exit consumer businesses across parts Director and Chief Executive of of Asia and the Europe, including commercial banks to 15 years. The Australia and China. same limit will also be applicable to

Best Online Test Series Site for Bank | JAIIB | CAIIB | RRB NTPC | SSC and State Government 81 Jobs ambitiousbaba.com Online Test Series whole-time directors (WTD). This RBI announced ₹50,000 crore priority means that the same incumbent lending by banks for COVID-related cannot hold the post for more than 15 healthcare infrastructure years. The revised instructions will be applicable to all the Private Sector Banks The Reserve Bank of India (RBI) will including Small Finance Banks (SFBs) give banks Rs 50,000 crore to enable and wholly owned subsidiaries of them to lend further for "healthcare Foreign Banks. needs" in the Covid-19 crisis, said governor Shaktikanta Das on 5th May. Shivalik Small Finance Bank Limited Begins Operations “On-tap liquidity of Rs 50,000 crore at repo rate is being opened till March 31, Shivalik Small Finance Bank Limited 2022. has commenced operations as a small finance bank with effect from April 26, RBI will conduct first SLTRO for small 2021.The Reserve Bank has issued a finance banks licence to the bank under Section 22 (1) The Reserve Bank of India recently of the Banking Regulation Act, 1949 to announced that it is to conduct the first carry on the business of small finance Special Long Term Repo Operation bank in India. (SLTRO) of Rs 10,000 crores for Small It must be remembered that the Shivalik Finance Banks. Mercantile Co-operative Bank (SMCB) is The RBI will conduct the SLTRO for each the first urban co-operative bank (UCB) month starting from May 2021. This is to in India to receive license from RBI to continue till October 2021. The SLTRO operate as a Small Finance Bank (SFB). will be valid for three years. All the Small RBI has joined network for greening Finance Banks shall participate in the financial system SLTRO. Bajaj Finance got RBI approval for The Reserve Bank of India (RBI) has prepaid payment business joined the Central Banks and Supervisors Network for Greening the Bajaj Finance is all set to join the likes of Financial System (NGFS) as a member. Paytm and Amazon in the prepaid The central bank joined the NGFS on payment segment with the Reserve April 23, 2021. Bank of India (RBI) approving the non-bank lender’s foray with Benefit: The RBI expects to benefit from perpetual validity. the membership of NGFS by learning from and contributing to global efforts UN raised global economic forecast to on green finance, which has assumed 5.4% growth in 2021 significance in the context of climate change. The United Nations on 12th May responded to the rebounding Chinese and U.S. economies by revising its May 2021 global economic forecast upward to 5.4% growth for 2021, but it warned that surging COVID-19 cases and inadequate availability of vaccines in

Best Online Test Series Site for Bank | JAIIB | CAIIB | RRB NTPC | SSC and State Government 82 Jobs ambitiousbaba.com Online Test Series many countries threaten a broad-based PayPal introduced digital foreign recovery. inward remittance advice In raising its projection from January of Digital payments provider PayPal has 4.7% growth, the U.N.’s mid-2021 World introduced an automated process to Economic Situation and Prospects obtain monthly foreign inward report. remittance advice (FIRA), allowing Indian merchants to download their RBI announced Second Tranche of monthly digital FIRA issued by banks. purchase under G-SAP 1.0 RBI excluded The Reserve Bank of India recently from second schedule of RBI Act announced that the second tranche of open market purchase of Government The Reserve Bank of India (RBI) said it Securities is to be held on May 20, has excluded Lakshmi Vilas Bank 2021. This is to be held under G-Sec (LVB) from the Second Schedule of the Acquisition Programme. This second RBI Act after it was merged with DBS tranche is to be conducted for Rs 35,000 Bank India Ltd (DBIL) last year. crores. LVB is the second private sector bank In April 2021, the Reserve Bank of after Yes Bank which has run into rough India launched the Government weather during this year. In March, Security Acquisition Programme 1.0. capital-starved Yes Bank was placed It was held on April 15, 2021. RBI under a moratorium. The government purchased Rs 25,000 crores of rescued Yes Bank by asking the state- Government securities. run State Bank of India to infuse Rs 7,250 crore and take a 45 percent Earlier in May 2021, RBI announced that stake in the bank. the second tranche is to be purchased under G-SAP 1.0. India’s WPI Inflation Surged To 10.49% For April 2021 India received $83 billion in remittances in 2020: World Bank The Department for Promotion of Industry and Internal Trade recently India received over USD83 billion in released Wholesale Price in India for remittances in 2020, a drop of just 0.2 the month of April 2021. The annual per cent from the previous year, rate of inflation for the month of April despite a pandemic that devastated the 2021 was 10.49%. The WPI for the world economy, according to a World month of April 2021 stood at 128.1. Bank. The base year in calculating WPI is Note: Top 5 fixed as 2011-12. 2nd Place: China- USD 59.5 billion RBI will transfer Rs. 99,122 crore surplus to Central Government for 3rd Place: Mexico-USD42.8 billion FY21 4th Place: Philippines USD34.9 billion The Reserve Bank of India will 5th Place: Egypt- USD29.6 billion transfer Rs 99,122 crore surplus to the Central Government for the 6th Place: Pakistan- USD26 billion

Best Online Test Series Site for Bank | JAIIB | CAIIB | RRB NTPC | SSC and State Government 83 Jobs ambitiousbaba.com Online Test Series accounting period of nine months alternative investment fund (AIF) of ended March 31, 2021 (July 2020- True Beacon Global. This is the first FPI March 2021). The Contingency Risk licence issued to an AIF incorporated in Buffer will remain at 5.50%. This year GIFT IFSC by any custodian bank or RBI has changed its Accounting year designated (DDP) from July-June to April-March to coincide in the country. with the accounting year of Government. Foreign direct investment jumped RBI increased the limit for Full-KYC 19% to $59.64 billion in 2020-21 PPIs to Rs 2 lakh from Rs 1 lakh Foreign direct investments (FDI) into The Reserve Bank of India has the country grew 19 per cent to USD increased the maximum amount 59.64 billion during 2020-21 on outstanding in respect of full-KYC account of measures taken by the PPIs (KYC-compliant PPIs) from Rs. 1 government on the fronts of policy lakh to Rs. 2 lakh. reforms, investment facilitation and ease of doing business. Note: RBI has also permitted cash withdrawal from Full-KYC PPIs of Total FDI, including equity, re-invested Non-Bank PPI Issuers. The condition earnings and capital, rose 10 per cent to on such cash withdrawal shall be: the "highest ever" of USD 81.72 billion during 2020-21 as against USD 74.39 • Maximum limit of Rs. 2,000 per billion in 2019-20. In terms of top transaction with an overall limit investor countries, Singapore is at the of Rs. 10,000 per month per PPI. top with 29 per cent share. It was

• All cash withdrawal transactions followed by the US (23 per cent) and performed using a card/wallet Mauritius (9 per cent) during the last shall be authenticated by an fiscal. "FDI equity inflow grew by 19 per Additional Factor of cent in 2020-21 (USD 59.64 billion), Authentication (AFA) / PIN; compared to 2019-20 (USD 49.98 • RBI has increased the limit of cash billion). withdrawal from Points of Sale (PoS) terminals using debit cards Value and volume of banknotes in and open system prepaid cards circulation increased by 16.8% and (issued by banks) to Rs 2000 per 7.2% respectively in 2020-21: RBI transaction within an overall The Reserve Bank of India on 27th monthly limit of Rs. 10,000 across May said banknotes in circulation all locations (Tier 1 to 6 centres). witnessed higher than average Earlier this limit was Rs 1000 for increase during 2020-21, on account of Tier 1 and 2 cities while Rs 2000 precautionary holding of cash by people for Tier 3 to 6 cities. due to the COVID-19 pandemic, and its issued India’s prolonged continuance. The value and first FPI licence to GIFT AIF volume of banknotes in circulation increased by 16.8 per cent and 7.2 per Kotak Mahindra Bank has issued the cent, respectively, during 2020-21, as first-ever foreign portfolio investor against an increase of 14.7 per cent (FPI) licence to the GIFT IFSC

Best Online Test Series Site for Bank | JAIIB | CAIIB | RRB NTPC | SSC and State Government 84 Jobs ambitiousbaba.com Online Test Series and 6.6 per cent, respectively, beneficiary in India, thus making ICICI witnessed during 2019-20. Bank first lender in Asia-Pacific and the second globally to offer the facility, Frauds reported by banks fell by 25% called ‘SWIFT gpi Instant’, for cross in value terms to Rs 1.38 lakh crore in border inward payments. 2020-21: RBI RBI lowered FY22 GDP forecast to Frauds reported by banks fell by 25% 9.5%, CPI inflation projected at 5.1% in value terms in just one year to Rs 1.38 lakh crore at the end of fiscal The Reserve Bank of India (RBI) has year ended March 2021, data released cut its projection for gross domestic by the RBI as part of it annual report product (GDP) growth for fiscal 2021- showed. 22 (FY22) to 9.5 per cent from the earlier forecast of 10.5 per cent. During the same period last year total frauds reported by lenders was at Rs Consumer price inflation (CPI), the 1.85 lakh crore. In number terms fraud central bank said, is likely to be at 5.1 per reporting was down by 15 percent on a cent in FY22 as compared to the earlier year basis to 7363. Public sector banks forecast of 5.2 per cent (5.2 per cent in contributed to more than 59 percent Q1; 5.4 per cent in Q2; 4.7 per cent in Q3; of the total value of frauds at Rs 81,901 and 5.3 per cent in Q4) with risks evenly crore while private sector banks balanced. contributed 33 percent at Rs 46,335 India: 4th largest Forex Reserves crore. holder June 2021 India’s forex reserves crossed $600 Wipro became third Indian IT firm to mark for the first time and as on June touch Rs 3 trillion market cap 4, it stood at $605 billion. With this, India equals Russia as the fourth largest Wipro on 3rd June touched Rs 3 reserve holder worldwide. India’s forex trillion in market capitalisation for reserve was $605.008 billion while for the first time, becoming the third Russia it was $605.2 billion. Indian IT firm to achieve the milestone after Tata Consultancy Services and SBI launched Kavach Personal Loan Infosys. The company won its largest for Covid-19 patients deal ever from German retailer Metro State Bank of India (SBI) has launched and has seen deal wins of $7.1 billion. a collateral-free “Kavach Personal ICICI Bank Became 2nd Globally to Loan” to enable its customers to meet offer ‘SWIFT gpi Instant’ facility medical expenses of self and family members for Covid treatment. Under ICICI Bank on June 2 announced that it this scheme, customers can avail of has tied up with SWIFT to offer instant loans up to ₹5 lakhs at an effective facility for cross-border inward interest rate of 8.5 per cent per annum remittances. for 60 months, which is inclusive of three This facility will help overseas partner months moratorium. banks to send instant remittances on behalf of their customers to the

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Policybazaar got insurance broking The Ministry of Finance has given its licence allowance to housing finance companies (HFCs) with asset sizes of Policybazaar said it has got approval more than Rs. 100 crore to recover the from regulator IRDAI to undertake dues using SARFAESI law. insurance broking, a development that will help the company augment Prior to this, Finance Ministry allowed business and expand bouquet of HFCs with assets over Rs. 500 crore to services. use SARFAESI law to recover dues. Canara Bank will be lead sponsor of Kotak Mahindra Bank launched ‘Pay bad bank, will pick up 12% stake Your Contact’ service State-owned Canara Bank said it will Kotak Mahindra Bank has announced be the lead sponsor of National Asset the launch of ‘Pay Your Contact’ the Reconstruction Company Limited new feature that enables its customers to (NARCL) or bad bank with 12 per cent send money or make payments to any of stake in the entity. Bad bank refers to a their contacts across all payment apps financial institution that takes over bad simply by the beneficiary’s mobile assets of lenders and undertakes number. resolution. "The Indian Banks' SBI launched Aarogyam healthcare Association (IBA), vide their letter dated business loan May 13, 2021 requested Canara Bank to participate in NARCL as sponsor. The The State Bank of India (SBI) has board of Canara Bank has given in- launched the Aarogyam healthcare principle approval for taking stake in business loan to provide enhanced NARCL. support to the healthcare sector amid the pandemic. Under this new product, The proposed NARCL would be 51% entire healthcare ecosystem such as promoted by PSBs and remaining by hospitals, nursing homes, diagnostic private sector lender. Banks have centres, pathology labs, identified around 22 bad loans worth manufacturers, suppliers, importers, Rs 89,000 crore to be transferred to logistic firms engaged in critical the NARCL in the initial phase. healthcare supply can avail of loans IDFC First Bank launched 'Ghar Ghar up to Rs 100 crore (as per the Ration' program geographic location) repayable in 10 years. IDFC First Bank has announced the launch of the "Ghar Ghar Ration" In metro centres loans under Aarogyam Program, an Employee-funded program can be availed up to Rs 100 crore, Tier for its low-income customers whose I & Urban centres up to Rs 20 crore and livelihoods are affected by the Covid- in Tier II to Tier VI centres upto Rs 10 19 pandemic. crore. Government allowed HFCs above Rs LIC introduced Technology Platform 100 crores to use to SARFAESI law ‘e-PGS’

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Life Insurance Corporation (LIC) has Finance Minister Nirmala Sitharaman launched a centralized web-based announced a relief package worth Rs workflow-based IT platform called “e- 6,28,993 crore to support Indian PGS”. New technology platform, e-PGS, economy in the fight against COVID- has been designed to provide a 19 pandemic. centralized collection and payment A total of 17 measures amounting to Rs accounting with high level of bank 6,28,993 crore were announced 3 broad integration. categories. Economic Relief from BIS: India’s bank credit-to-GDP ratio Pandemic (8), Strengthening Public grew 56% in 2020 Health (1), Impetus for Growth & Employment (8). Bank for International Settlements (BIS), incremental credit growth has About Relied Fund decreased to 59-year low at 5.56% in Economic relief from COVID-19 Financial Year 2021. Pandemic - Rs 3,76,244 crores As per data, bank credit-to-GDP ratio has New scheme for Public Health - Rs increased to a five-year high at about 15,000 Crores 56% in 2020. However, this increase is way behind its peers and is half of the Impetus for Growth and Employment G20 average. - Rs 2,37,749 Crores Total outstanding bank credit was at Total - Rs 6,28,993 Crores $1.52 trillion in 2020 at the credit-to- Policy Rates GDP ratio of 56%. However, this was the second lowest among all other Asian Repo Rate 4.0% countries. Sitharaman announced Rs 1.1 lakh Reverse Repo Rate 3.35% crore loan guarantee scheme for Covid-hit sector Marginal Standing Facility (MSF) 4.25% Rate Finance Minister Nirmala Sitharaman on 28th June announced Rs 1.1 lakh crore Bank Rate 4.25% loan guarantee scheme for Covid- affected sectors, including health sector, Cash reserve Ratio (CRR) 4.0% which includes guarantee cover for expansion or for new projects. Besides, Statutory Liquidity Ratio (SLR) 18% an additional Rs 1.5 lakh crore limit enhancement was also announced for Emergency Credit Line Guarantee ATM cash withdrawal rule changed Scheme (ECLGS) scheme expanding the existing limit of Rs 3 lakh crore by 50%. Reserve Bank of India (RBI) has changed some rules regarding cash FM Sitharaman’s announced relief withdrawal from automated teller package worth Rs 6,28,993 crore machine (ATM). against COVID-19

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• Free cash withdrawal limit value-added services for every doctor, from own bank: Bank customers beginning from a medical student to a can now do five free financial and senior medical consultant to an owner of non-financial transactions every a hospital or a clinic. month from their own bank HDFC Bank launched ‘Salaam Dil Sey’ ATMs. initiative • Free ATM transaction limit from other bank: ATM card HDFC Bank launched a SalaamDilSey holders can do three free financial initiative to show gratitude to doctors and non-financial transactions in for their tireless service during the metro centres while five in non- pandemic, to pay tribute to doctors metro transaction from other across the country. bank ATMs India recorded current account • Charges on ATM cash surplus of 0.9% in FY21 withdrawal beyond free limit: RBI allowed banks to increase According to the data released by the charges on ATM transactions Reserve Bank of India, India reported beyond free ATM transaction a current account surplus of 0.9% of limit. GDP in FY 21. In FY 20 there was a • Rise in interchange fee: current account deficit of 0.9%. The Interchange fee per transaction reason for the Current Account Surplus changed from Rs 15 to Rs 17 for in FY21 is a sharp contraction in the financial transactions while from trade deficit to US$ 102.2 billion from Rs 5 to Rs 6 for non-financial US$ 157.5 billion in 2019-20. India has transactions in effect from August seen a Current account surplus for the 1, 2021. first time in 17 years. • New charges on ATM LIC launched Saral pension plan withdrawal beyond free transaction limit: Bank The Life Insurance Corporation (LIC) customer will have to pay Rs 21 of India on 1st July 2021 launched (currently it is Rs 20) for each Saral pension plan — a non-linked, ATM cash withdrawal beyond non-participating, single premium, free transaction limit in effect individual immediate annuity plan. from January 1, 2022. This LIC Saral pension plan offers two annuity options to the policy holders after one-time lump sum amount payment. The plan also offers loan July 2021 facility to the policy holder after six ICICI Bank launched a comprehensive months of the plan purchase. In this LIC banking solution for doctors of India pension plan, the policy holder will can pay a lumpsum as purchase price ICICI Bank announced the launch of and get a fixed payment at regular the country’s most comprehensive intervals for the rest of its life. The banking solutions for medical minimum annuity that a policy holder doctors. Called ‘Salute Doctors’, it can avail is ₹12,000 per annum. provides customized banking as well as

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Indian Overseas Bank became the employees and Dearness Relief to second most-valued public lender pensioners to 28 per cent. This hike represents an increase of 11 per cent Indian Overseas Bank (IOB) has over the existing rate of 17 per cent of become the second most-valued listed the basic pay/pension. The increased public sector bank (PSB) with a DA and DR rates will be effective from market capitalisation of over Rs July 1, 2021. 50,000 crore. PNB was valued at Rs 46,356 crore and BoB at Rs 44,060 FDI limit in NPS fund managers hiked crore, which are now ranked third and to 74% from 49% fourth among PSBs, respectively. The government notified a hike in the Paytm launches ‘Postpaid Mini’ to foreign direct investment limit in provide small-ticket instant loans pension fund management to 74% from 49% under the national pension Paytm has announced the launch of system (NPS). Pension Fund Regulatory Postpaid Mini, small-ticket loans that &Development Authority (PFRDA) Act will give users the flexibility to access links the FDI ceiling in the insurance loans ranging from Rs 250 – Rs 1,000, sector. in partnership with Aditya Birla Finance Ltd. Paytm Postpaid is offering a period Federal Bank launched “FEDDY” AI- of up to 30 days for repayment of Powered virtual assistant for loans at 0% interest. customers RBI Launched ‘Retail Direct Scheme’ The Federal Bank has launched “FEDDY”, an Artificial Intelligence- The Reserve Bank of India (RBI) on powered virtual assistant to help 13th July announced the ‘RBI Retail customers with banking-related Direct’ scheme for retail investors, queries anytime. FEDDY can be through which they can directly buy accessed via Alexa, Google Assistant and and sell government securities (G- WhatsApp. Secs), both primary and secondary. SBI selected Paisalo as its National As per the central bank, under the ‘RBI Corporate Business Correspondent Retail Direct’ scheme, retail investors (individuals) will have the facility to State Bank of India (SBI) has selected open and maintain the ‘Retail Direct Gilt “Paisalo Digital” as the National Account’ (RDG Account) with the RBI. Corporate Business Correspondent of “RDG account can be opened through the Bank for financial inclusion by an online portal provided for the providing banking services through purpose of the scheme. kiosks. Cabinet approved increase in DA and RBI increased loan limit of bank Dearness Relief from 17% to 28% directors to Rs 5 cr from Rs 25 lakh The Union Cabinet headed by Prime The Reserve Bank of India on 23rd Minister Narendra Modi has approved July increased the limit of personal an increase in the Dearness loans given to any director of a bank Allowance to Central Government to Rs 5 crore, from Rs 25 lakh earlier.

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Government has permitted FDI up to Importantly, HDFC Bank won’t seek 100% under the automatic route for collateral security, business financials, renewable energy projects and income tax returns from retailers who apply for the scheme. Government has permitted Foreign Direct Investment (FDI) up to 100 RBI Authorises IndusInd Bank to act percent under the automatic route for as an ‘Agency Bank’ renewable energy projects, including The IndusInd Bank has been offshore wind energy projects. empanelled by the Reserve Bank of August 2021 India (RBI) to act as an ‘Agency Bank’. As an Agency Bank, IndusInd becomes GST collection recovers to a 3-month eligible to carry out transactions related high of Rs 1.16lac Cr. in July to all kinds of government-led The Goods and services tax (GST) businesses. collection recovered to a three-month IndusInd Bank now joins few other high in July, exceeding the Rs 1.1 private banks of the country listed as trillion mark, as economic activity Agency Bank of RBI, to carry out general resumed with most states easing Covid- banking business on behalf of the central 19 restrictions, official data showed on 1 and state government, apart from August. offering its customers the convenience of The GST mop-up in July stood at Rs undertaking routine financial 1,16,393 crore, as against Rs 92,849 transactions through its banking crore in June, according to the data platform. released by the finance ministry. RBI revises retail inflation projection HDFC Bank launched ‘Dukandar for FY22 to 5.7% Overdraft Scheme’ The Reserve Bank of India (RBI) has HDFC Bank announced the launch of revised upwards retail inflation an overdraft facility for small projection for FY 22 to 5.7 per cent retailers in partnership with CSC SPV. from 5.1 per cent, even as it retained Known as ‘Dukandar Overdraft real GDP projection at 9.5 per cent. Scheme’. The scheme by HDFC Bank is The revised quarterly retail inflation aimed at helping shopkeepers and projections are: 5.9 per cent in Q2 (5.4 merchants ease their cash crunch. per cent earlier projection); 5.3 per cent According to the bank, retailers in Q3 (4.7 per cent); and 5.8 per cent in operating for a minimum of three years Q4 (5.3 per cent) of 2021-22. are eligible for the scheme by providing Sebi allows payments banks to act as six months bank statement from any investment bankers bank. Sebi has allowed payments banks to HDFC Bank will approve an overdraft carry out the activities of investment limit from a minimum of Rs 50,000 to a bankers to provide easy access to maximum of Rs 10 lakhs based on the investors to participate in public and statements.

Best Online Test Series Site for Bank | JAIIB | CAIIB | RRB NTPC | SSC and State Government 90 Jobs ambitiousbaba.com Online Test Series rights issues by using various payment National Rural Livelihoods Mission) avenues, markets regulator. from Rs. 10 lakhs to Rs. 20 Lakhs. Non-scheduled payments banks, which The DAY-NRLM is the flagship program have prior approval from the Reserve of Govt. of India for promoting poverty Bank of India (RBI), will be eligible to act reduction through building strong as a banker to an issue (BTI). institutions for the poor, particularly women, and enabling these institutions Suryoday Small Finance Bank to access a range of financial services and Launched ‘Health and Wellness livelihoods. Savings account HCL Technologies becomes 4th IT Suryoday Small Finance Bank (SSFB) firm to hit Rs 3 trillion market-cap has launched a ‘Suryoday Health and Wellness Savings Account’ to help HCL Technologies' market customers grow their wealth and also capitalisation (market-cap) touched take care of their family’s health amid Rs 3 trillion for the first time on 13th the covid-19 pandemic. Aug, becoming the fourth Indian information technology (IT) firm to The account offers an attractive interest achieve this milestone after Tata rate and comes with three major benefits Consultancy Services (TCS), Infosys and for a family of four — top-up health Wipro. insurance of ₹25 lakh, annual healthcare package and on-call emergency Shares of HCL Tech hit a fresh record ambulance medical care services. high of Rs 1,118.55, up 2 per cent on the BSE in intra-day trade, surpassing its RBI to impose monetary penalty on previous high of Rs 1,101 touched on ATMs that run out of cash from 12th Aug in intra-day deal. October 1 Number Of Billionaires In India Reserve Bank of India (RBI) has Dropped From 141 to 136 decided to charge penalties on banks for non-availability of cash in ATMs. In the pandemic-hit financial year of 2020-21, the number of billionaires in Starting October 1, 2021, cash-out at India dropped from 141 in FY20 to any ATM of more than 10 hours in a 136 in FY21, as per a statement issued month will attract a flat penalty of Rs by Finance Minister Nirmala Sitharaman 10,000 per ATM. In case of White Label in the Rajya Sabha. ATMs (WLAs), the penalty would be charged to the bank which is meeting the The count is based on the gross total cash requirement of that particular WLA. income declared in the income tax returns. In FY 2018-19, the number of RBI increase collateral-free loans to individuals with a gross total annual Self Help Groups income of more than Rs 100 cr is 77. The Reserve Bank of India has raised the limit for collateral-free loans to Self-Help Groups (SHG) under the DAY- SBI Life launches new-age term NRLM (Deendayal Antyodaya Yojana – insurance policy “SBI Life eShield Next”

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• SBI Life Insurance announced the • About: Financial Inclusion Index has launch of a unique new age been conceptualised as a protection solution called ‘SBI Life comprehensive index comprising the eShield Next’, which ‘levels up’ the details of banking, insurance, protection coverage as the insured investments, postal and pension achieves life’s major milestones. sector in consultation with government and sectoral regulators. • This means that the policy is neither linked to the stock market nor shares any profit or dividends with the Infosys becomes 4th Indian company policyholders. to touch $100 billion m-cap

RBI will introduce ‘Regulatory GAAR’ • Infosys crossed the $100 billion mark in terms of market for round-tripping capitalisation on 24th Aug, becoming the fourth Indian • The Reserve Bank of India (RBI) company. has come up with a draft rule with modifications in the existing • Reliance Industries (m-cap of $140 regulation related to foreign billion), Tata Consultancy Services investment to discourage round- (m-cap $115 billion) and HDFC Bank tripping. The central bank is looking (m-cap $100.1 billion) are the other to tweak the existing regulations and Indian firms in the club with Infosys. has come up with draft rules around round-tripping. RBI extends card payment • Some of the largest Indian companies, startups and tokenisation facility to laptops, multinationals with an India wearable devices presence have put their outbound investment, fundraising and • In 2019, RBI had permitted restructuring plans on hold as the authorized card payment RBI looks to introduce fresh networks to offer card regulations around “round- tokenisation services to any token tripping.” requestor (i.e., third-party app provider) through mobile phones and tablets. RBI introduced Financial Inclusion • Now RBI has extended the scope of Index tokenization to include consumer devices – laptops, desktops, • The Reserve Bank of India wearables (wristwatches, bands, introduced the financial inclusion etc.), Internet of Things (IoT) index on August 17, 2021. devices, etc. • The Financial Inclusion Index will be • The permission for tokenization used to capture the extent of financial extends to various channels [e.g., inclusion in India. This index was Near Field Communication (NFC) / part of the announcements made in Magnetic Secure Transmission (MST) first bi-monthly monetary policy of based contactless transactions, in- April 2021.

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app payments, QR code-based maximum number of transfers in a payments, etc.] or token storage year allowed at 12. mechanisms (cloud, secure element, trusted execution environment, etc. PhonePe receives direct broking

RBI enhances limit under Indo- licence from IRDAI

Nepal Remittance Facility to Rs 2 • Flipkart-owned digital payments lakh platform PhonePe has received an insurance broking licence from the Insurance Regulatory and • The Reserve Bank of India has Development Authority of India increased the limit of fund transfer (IRDAI). This means that with the under the Indo-Nepal Remittance new ‘direct broking’ licence, PhonePe Facility Scheme from Rs 50,000 can now distribute insurance per transaction to Rs 2 lakh per products from all insurance transaction. Earlier there was a companies in India, on its platform. ceiling limit of 12 transactions in a year. • Earlier in January 2020, PhonePe entered the insurtech sector, but with • This limit has also been removed. a limited insurance ‘corporate agent’ However, for cash-based transfers licence, which restricted it to partner under the Indo-Nepal Remittance with only three insurance companies Facility, the per transaction limit of per category. Rs 50,000 will still be present with a

Topic 10: India’s GDP Growth Forecast FY 21 and 22 by various Financial Organizations (last Update 31 August 2021)

Organization 2020-21 FY 22 (2021-22)

Fitch (-)9.4% (Update-8 Dec) 9.5% (Update 7 May)

HSBC Bank 11.2%

RBI forecasted (-)7.5%(Update-4 Dec) 9.5% (Update 5 june)

Moody (-)7%(Update-25feb) 9.6% (2021), 7%(2022)

(Update 23 June)

Asian Development Bank (-)8%(Update-15 Dec) 10% (Update 20 July) (ADB)

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World Bank (-)9.6%(Update-6 Oct) 8.3% (Update -13 June)

World Economic Outlook (-)8% (Update-27th Jan 9.5%(Update -28 July 2021) released by 2021) International Monetary Fund (IMF)

FICCI (-)8% (Update 27Jan)

Organisation for Economic (-)9.9% (Update-2dec) 9.9% (Update 1 June 2021) Co-operation and Development (OECD)

DBS Bank (-)6% (Update 22 July)

Goldman Sachs (-)10.3% (Update 18 Nov) 11.1% (Update 4th May 2021)

CRISIL (-)7.7%(Update 15 Dec) 9.5% (Update 7th June)

UN (United Nation) (-)9.6%(Update 26th Jan 7.5%(Update 12 May) 2021)

Confederation of Indian between (-)0.9 per cent 9.5% (update 18 June) Industry (CII) and 1.5 per cent

India Ratings & Research (-)7.6% 9.4% (Update 19 Aug) (Ind-Ra)

Economy Survey (-)7.7 11% (Update 1 feb)

National Council of Applied (-)7.3%(Update-26 Dec) Economic Research (NCAER)

Standard & Poor’s (S&P) (-)7.7% Update-14 Dec) 9.5% (Update 25 June)

ICRA (-)7% (Update-26 feb) 8.5%(Update 15 June)

State Bank of India (SBI) (-)7(Update-11 Feb) 7.9%(Update 1 June,2021)

JP Morgan 11% (Update 19th April 2021)

CARE Ratings (-)8% (Update-14 sept) 8.8 to 9%%(Update 27 July 2021)

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Normura -6.7% (Update-14th Jan 10.8% (Update 11 May 2021) 2021)

Oxford Economics 10.2%

Brickwork Ratings 11% (Update 12 Jan)

UBS -7.5% (Update-14 Jan 10% (Update 19th April 2021) 2021)

Barclays 7.7% (Update 26May 2021)

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