www.gradeup.co 1 www.gradeup.co GK Tornado for IBPS Clerk Main Exam -2019 Dear Aspirants, This GK Tornado is a complete docket of important Banking Awareness & Current Affairs news and events that occurred in last 4 months (1st September 2019 – 10th January 2020). This file is important and relevant for all competitive exams like Banking, Insurance, SSC and UPSC Exams. News related to RBI January /December 1. RBI revised the supervisory framework for Urban Co- Note: operative Banks: • RBI has launched the ‘MANI’ app for visually Note: impaired people to identify denomination of the new • To prevent PMC Bank-like scams the Reserve currency notes. The full form of ‘MANI’ is “Mobile Bank of India (RBI) has revised the supervisory Aided Note Identifier”. The MANI App also works action framework for urban co-operative banks offline once installed. (UCBs). • MANI application scans currency notes using camera • As per the guidelines, UCBs, with deposits of Rs and gives audio output in Hindi and English. 100 crore and above, will constitute the BoM, • There were challenges faced by visually challenged in which will be a mandatory requirement for identifying these notes. Hence, the application has opening new branches. been launched to help visually aided in easily • A UCB may be placed under supervisory action identifying the notes. However, the application does framework when its net non-performing assets not detect genuine or counterfeit notes. (NPAs) exceed 6% of its net advances. 4. RBI directs large UCBs to report exposures above Rs 5 • As soon as this threshold is breached, the cr to CRILC: regulator may initiate multiple actions, Note: depending on severity of stress. • In order to detect the financial distress at earliest • The central bank can ask UCB to submit a the RBI has directed large cooperative banks to board-approved action plan for reducing its net report all exposures of Rs 5 crore and more to the NPAs below 6%. Central Repository of Information on Large Credits (CRILC). 2. RBI granted in principle approval to Shivalik Mercantile • to become SFB: The aggregate exposure will include all fund-based Note: and non-fund based exposures like partial credit enhancement, including investment exposure on • The Reserve Bank of India (RBI) has granted in- the borrower. principle approval to Uttar Pradesh-based • As per the new rules, Urban Cooperatives Banks are Shivalik Mercantile Co-operative Bank Ltd to required to submit CRILC report on quarterly basis convert to a small finance bank (SFB). with effect from December 31, 2019. • Thus, it becomes the first urban cooperative 5. RBI launches new prepaid payment instrument (PPI) bank (UCB) to make the transition since the for small digital transactions guidelines came out nearly two years ago. Note: • Approval granted will be valid for 18 months to • In order to the digital transaction in India the enable the applicant to comply with the Reserve Bank (RBI) has introduced a new semi- requirements under the scheme on voluntary closed prepaid payment instrument (PPI). transition of urban co-operative bank into a • The new PPI can be used for transaction of goods small finance bank. and services up to a limit of Rs 10,000. 3. ‘MANI’ App launched by RBI for visually challenged to • This direction was made under Section 18 read with Identify currency Denomination: Section 10(2) of Payment and Settlement Systems Act, 2007. 2 www.gradeup.co • These PPIs will enhance the digitization of daily to voluntarily transit into SFBs, initial requirement of net payments at local shops and retail outlets for the worth shall be at Rs.100 crores that will have to be purchase of daily household goods and services. increased to Rs.200 crores within 5 years from date of 6. RBI sets ₹50-lakh lending cap on NBFC-P2P platforms commencement of business. Payments Banks like Note: Paytm an IndiaPost and Fino can apply for conversion • In order to protect the consumers interest, the Reserve Bank of India (RBI) has set a ₹50-lakh cap on into SFB after 5 years of operations, if they are the aggregate exposure of a lender to all borrowers otherwise eligible as per these guidelines. As of now, across all Non-Banking Financial Company – Peer to the RBI has issued licences to 10 SFBs. Peer (NBFC-P2P) lending platforms at any point of 10. RBI released fifth bi-monthly Monetary Policy review: time. The Reserve Bank of India on December 5, 2019, • Further, the RBI has specified that the investments of released its fifth bi-monthly monetary policy statement the lenders on P2P platforms have to be consistent for the year 2019-20. In this RBI decided to keep key with their net-worth. policy rate unchanged. • A NBFC-P2P is an intermediary providing the Key rates are as below: services of loan facilitation via online medium or Note: The repo rate under the liquidity adjustment otherwise to the participants, who enter into an facility (LAF) left unchanged to 5.15%. The reverse repo arrangement with the intermediary to lend on it or rate under the LAF stands same i.e. 4.90%. to get the loan facilitation services provided by it. 7. RBI to buy, sell government bonds worth Rs 10,000 Current Policy Rates: crore on Monday Policy Repo Rate 5.15% Note: Reverse Repo Rate 4.90 % • The Reserve Bank of India (RBI) on December 23, 2019 Marginal Standing Facility Rate 5.40% will simultaneously purchase and sell government securities worth Rs 10,000 crore under a special Open Bank Rate 5.40% Market Operation (OMO). 11. NEFT transactions to be made 24×7 from 16th • Such exercises are done by the central bank when the December 2019: proceeds from sale of short-term securities are used Note: The Reserve Bank of India (RBI) announced that to buy long-term government securities or bonds in a all bank customers will be able to transfer funds through bid to bring down interest rates on long-term NEFT around the clock on all days including weekends securities. and holidays from December 16, 2019. These • The purchase will be for government securities worth transactions after the usual banking hours are set to be Rs 10,000 crore for the instrument ‘6.45 per cent GS automated initiated using 'Straight Through Processing 2029’. (STP)' modes by the banks. The existing discipline for 8. RBI waives NEFT, RTGS transfer charges for savings crediting the beneficiary's account or returning the account holders: transaction within 2 hours of settlement to the • The Reserve Bank of India (RBI) has waived NEFT, RTGS transfer charges for savings account holders. originating bank will also continue. • In an order, RBI instructed banks to make all online 12. RBI Imposes Rs 1.50 crore penalty on Corporation payments done through RTGS and NEFT free of cost Bank: for savings account holders. The new rule will be Note: The Reserve Bank of India (RBI) has imposed a effective from January 1, 2020. monetary penalty of Rs. 1.50 crore on Corporation Bank 9. RBI Unveils Guidelines on Small Finance Banks: for non-compliance with certain provisions of directions. Note: The Reserve Bank of India (RBI) has released The penalty has been imposed in the exercise of powers ‘Guidelines for ‘on tap’ Licensing of Small Finance Banks vested in the RBI under the provisions of Section 47 A (SFB) in the Private Sector’. The on-tap facility allows (1) (c) read with Section 46 (4) (i) and 51 (1) of the RBI to accept applications and grant licence for banks Banking Regulation Act, 1949. This action is based on throughout the year. Minimum paid-up voting equity the deficiencies in regulatory compliance and is not capital/ net worth requirement shall be Rs.200 crore. intended to pronounce upon the validity of any For Primary (Urban) Co-operative Banks (UCBs), aspiring 3 www.gradeup.co transaction or agreement entered into by the bank with rupees for all borrowers and lenders on all P2P platforms. its customers. Apart from this, a single borrower can only take up to a 13. Reserve Bank expressed concern over rising bad assets maximum of Rs 50,000 from a lender on all NBFC (Non- from Mudra loans: Banking Financial Company)-P2P platforms. Note: The Reserve Bank of India (RBI) has expressed 17. RBI revises framework on SAARC currency swap concern over rising bad loans from Pradhan Mantri arrangement: MUDRA Yojana (PMMY). This scheme was announced by Note: The Reserve Bank of India (RBI) has revised the Prime Minister Narendra Modi in April 2015, which South Asian Association for Regional Cooperation offers faster credit, with ticket sizes starting from (SAARC) currency swap arrangement framework for a ₹50,000 and going up to ₹10 lakh, to small businesses. period of November 14, 2019, to November 13, 2022. As According to RBI, the percentage of MUDRA loans were per the new framework, RBI continues to offer a swap at 2.52% in 2017-18, It has now raised to 2.89% in 2018- arrangement within the overall corpus of USD 2 billion. 19. It also says that the number of loans being sanctioned The drawal can be made in US Dollars, Euro or Indian under the scheme has increased greatly. Rupee. There are certain concessions for swap drawal in 14. RBI Enhances Scope of Non-Resident Rupee Accounts: Indian Rupee. Note: The RBI expanded the scope of Special Non- 18. RBI disclosed major wilful defaulter details under RTI Resident Rupee Accounts (SNRR account) by permitting act 2005: non-residents to open such accounts for rupee- Note: The Reserve Bank of India (RBI) has disclosed list of denominated overseas borrowings, trade credit and 30 major wilful defaulters of India.