Current Affairs August 2016 - Finance


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News 1 - SEBI's first phase of new enterprise portal goes live

Security and Exchange Board of India

SEBI has gone live with its new Enterprise Portal. This new portal, which replaces the existing one in a phased manner, will enable accurate and timely information dissemination to internal and external stakeholders. The new portal is being developed by IT major Tech Mahindra.

The first phase of the project provides SEBI employees and some of its market intermediaries with an interactive portal which improves customer centricity by supporting multiple channels and aligning with emerging digital trends.

News 2 - Oracle India joins SBI to nurture Digital Skills Initiative

Oracle

Oracle India announced a corporate citizenship collaboration with State Bank of India (SBI) and launched the 'D-Change' programme which will support education and learning, women's empowerment and rural skills development in the country.

As part of the programme, Oracle and SBI volunteers will help enhance IT literacy among high school students, teachers and parents from over 100 SBI-supported government schools through an initiative called "Digital Kushalta ki Aur." It will be initiated at Rotary Bangalore Vidyalaya in Bengaluru and Mandal Parishad High School, Kondapur in Hyderabad on August 6.

News 3 - ICICI Bank signs MoU with Apollo India to form ARC

ICICI Bank

ICICI Bank has inked an MoU with Apollo India Credit Opportunity Management LLC and AION Capital Management to set up an asset reconstruction company in order to resolve cases related to bad loans. The MoU is subject to regulatory approvals, acquisition of debt exposures from lenders and equity stakes in companies.

Canada's Brookfield announced a partnership with SBI to channel funds into stressed companies in July 2016. JC Flowers had entered into a partnership with investment bank Ambit Holdings. In March 2016, Kotak Mahindra Group tied up with Canada Pension Plan for investment in bad loans.

News 4 - Bank of Baroda signs agreement with start-up Fisdom

Bank of Baroda

Bank of Baroda has tied up with a fintech startup Fisdom for personal wealth management services. Fisdom app helps users make financial investments in an easy and paperless manner with personalised financial advice. It helps people manage their money with the help of a robo-advisor.

The bank has entered into pact with six other fintech companies, proficient in different areas - CreditMantri, FundsTiger, Probe42, Power2SME, IndiaLends and KredX.

News 5 - RBI introduces website ‘Sachet’ to check illegal Collection of Deposits

Sachet

Dr. Raghuram G. Rajan, Governor, Reserve Bank of India launched new website ‘Sachet’ to help public in gaining information regarding authorized entities that are allowed to accept deposits. Public can easily lodge complaints and also share information regarding illegal acceptance of deposits by illegal entities.

Further, members of public can file and track a complaint on this website if any entity has illegally accepted money from them and/or defaulted in repayment of deposits. They can also share information regarding any such entity on this portal. The website would also help enhance co-operation among regulators and State Government agencies.

News 6 - RBI constitutes household finance committee, chaired by Dr. Tarun Ramadorai

RBI

The Reserve Bank of India (RBI) has set up a committee to look at the various facets of household finance in India, to be chaired by Dr. Tarun Ramadorai, Professor of Financial Economics, University of Oxford. The committee will have representation from financial sector regulators, namely, Securities and Exchange Board of India (SEBI), Insurance Regulatory and Development Authority of India (IRDAI), Pension Fund Regulatory and Development Authority (PFRDA) apart from Reserve Bank of India (RBI).

The main objective behind setting up of committee is to benchmark the current depth of household financial markets in India and assess the role of new financial technologies and products.

News 7 - RBI published 3rd Bi-monthly Monetary Policy Statement 2016-17

Bi-monthly Monetary Policy

Reserve Bank of India has published the third bi-monthly monetary policy statement for the fiscal year 2016-17 and kept the rates unchanged. Following are the highlights of RBI’s third bi—monthly monetary policy statement, 2016-17:

  • Repo rate unchanged at 6.50%, Reverse Repo at 6%
  • Cash reserve ratio or CRR unchanged at 4%
  • Marginal Standing Facility Rate (MSF) - 7.00%- Unchanged
  • Bank Rate - 7.00%
  • Statutory Liquidity Ratio (SLR) - 21% - Unchanged
  • Base Rate - 9.30% - 9.70%
  • Growth forecast at 7.6% for the current fiscal
  • Inflation target remains 5% for January 2017
  • Normal monsoon, 7th Pay Commission award to boost growth
  • GST roll out to boost business sentiment, investment
  • FCNR(B) redemptions not to disrupt liquidity in market
  • Forex reserves at USD 365.7 billion on August 5

News 8 - Reliance General signed 'bancassurance' deal with Shamrao Vithal Cooperative Bank

SVCB

Reliance General Insurance Company Ltd announced a bancassurance tie-up with Shamrao Vithal Co-operative Bank (SVCB). As a part of the agreement, Reliance General, will distribute its insurance products to the customers of SVCB. SVCB has a network of 194 branches.

RGIC has already tied-up with IndusInd Bank, Bank of India and Andhra Bank. The move follows the recent IRDA guidelines that allow a bank to tie-up with multiple insurance companies as its bancassurance partners and help banks offer a well-rounded portfolio of insurance products to its customers.

News 9 - RBI announced short-term crop loans at subsidised rate of 7% for farmers

Subsidised Rate

The Reserve Bank of India has announced short-term crop loan of up to Rs 3 lakh at subsidized interest rate of 7 per cent for farmers. A subvention of 2 per cent per annum will be made available for short-term crop loan up to Rs 3,00,000 per farmer and additional interest subvention of 3 per cent per annum (loan payable at 4% per annum) to timely payee farmers.

The subvention will be given to small and marginal farmers on the basis of Kisan Credit Card up to six months period. In order to provide relief to farmers affected by natural calamities, the interest subvention of 2 per cent will continue to be available to banks for the first year on the restructured amount.

News 10 - RBI transfers Rs 65,876 crore surplus to government

RBI Transfers Crores to Govt

The Reserve Bank would transfer to the central government its surplus profit of Rs 65,876 crore which is marginally lower than the amount given last year. The approval to transfer the surplus was taken at the 559th meeting of the Central Board of the RBI, chaired by Governor Raghuram Rajan.

The surplus is generated through RBI's investment activities, primarily in other sovereign bonds like that of the US T-bills, which is its single largest investment source.

The government has been making its budget calculations about the RBI surplus payouts public as non-tax revenue.

News 11 - Two Cooperative banks of Chhattisgarh penalized by RBI

RBI Penalized two Banks

A heavy penalty of Rs. 5 lakhs each was penalized on Zila Sahakari Kendriya Bank Maryadit and Raipur Urban Mercantile Cooperative Bank Limited by the Reserve Bank of India under the Banking Regulation Act, 1949 for violation of the Know your Customer norms under RBI guidelines.

According to guidelines, loans cannot be granted to directors of bank or their relatives but guidelines were violated by Raipur Urban Mercantile Cooperative Bank Ltd.

News 12 - Corporation Bank introduces group credit life insurance scheme

Corporation Bank

The Group Credit Life Insurance Scheme launched by Corporation bank, is a kind of loansurance for the borrowers, who are granted term loan by the bank so as to provide an insurance cover to the loan availed by the customer, in the event of unfortunate death of the borrower. The Group Credit Life Insurance Scheme will be for the age group 18 to 60.

The scheme protects various term loans including retail loans namely, personal loan, home loans, vehicle loans, loans to MSME and agriculture.

News 13 - Flipkart now on Kotak Mahindra Bank's Mobile Banking App

Mobile Banking App

Kotak Mahindra Bank (KMB) announced the availability of Flipkart’s mobile site in its mobile banking app, which gives the customer a secure in-app shopping environment.

Customers can shop seamlessly and checkout faster with choice of relevant payment options, as billing and delivery details are already available with KMB. Furthermore, in-app shopping reduces transaction failures, and allows customers to track cancellations and refunds in the same window. Customers only need to register once on the app to start shopping.

News 14 - RBI relaxed cheque-book norms in cheque dishonor cases of Rs 1 cr and above

Cheques

The Reserve Bank of India revised and relaxed cheque-book issuance norms in cases of dishonor of 1 crore rupees and above by allowing banks to take decision on its own. As per the existing norms, banks are not allowed to issue fresh cheque-books in the event of cheque dishonor valuing Rs 1 crore and above on four occasions during a financial year for want of sufficient funds.

RBI announced in a notification that banks should come up with a transparent policy approved by the board or its committee to avoid penalizing customers for unintended dishonor of cheques.

News 15 - Kotak Mahindra Bank starts Innovation Lab, open to investing in start-ups

Kotak Mahindra Bank

Kotak Mahindra Bank has started an 'Innovation Lab' in Bengaluru to tap into the best technology that impacts its operations. The bank is also ready to invest in start-ups. The 'Innovation Lab' is a dedicated space from where the bank will partner with start-ups in the fintech space to test concepts and launch them into commercial products.

The bank is working with the start-ups in the artificial intelligence, analytics, biometric or iris scanning and machine learning space. A bulk of the start-ups are Bengaluru-based, while two are from the US and Australia.

News 16 - E-verification of Income tax Return with net-banking

Income Tax

Banks are likely to soon start a facility wherein an account holder can verify his income tax return on e-filing site even without having net-banking. Electronic Verification Code (EVC) can be generated by pre-validating the bank account on the e-filing portal of the Income Tax Department.

The facility has already been launched by PNB and UBI. Central Board of Direct Taxes (CBDT) has said that the EVC can also be generated by pre-validating a Demat Account on the e-filing portal. In addition, SBI, Axis and Canara bank have facilitated their customers to generate EVC through ATMs.

News 17 - Project Ananya launched by Syndicate Bank aimed at digital banking

Syndicate Bank

Syndicate Bank has started on a large scale transformation program called "Project Ananya" aiming to move from conventional banking to providing tech-enabled sales and services at its branches.

The bank plans to transform 10 per cent of its branches to the new format in the next 6-12 months. The project is being implemented with assistance from Boston Consulting Group (BCG). It is aimed at adopting digital platform and focusing on improving business through enhanced sales and services, besides improving the human resources policies of the bank. Arun Shrivastava is the MD & CEO of the Bank.

News 18 - SBI, Korea Development Bank join hands for biz opportunities

SBI Korea Development Bank

State Bank of India and Korea Development Bank have signed a MoU to enhance cooperation in areas including corporate finance, project finance and asset finance. The agreement was signed between SBI chairman Arundhati Bhattacharya, and Chairman and CEO of Korea Development Bank (KDB), Lee Dong Geol.

KDB is providing funding facility to SBI through credit lines and/or money market lines, as per terms agreed between the two banks. The funds may be used for money market, trade finance and loans to Korean companies doing business in India.

News 19 - IRDAI imposes Rs 35 Lakh Fine On Bharti AXA General Insurance

Insurance

Insurance Regulatory and Development Authority(IRDAI) has imposed Rs 35 lakh fine on Bharti Axa General Insurance Co Ltd for violating Group Insurance Guidelines (GIG) during December 2012 to March 2013. IRDAI also imposed an additional penalty of Rs 5 lakh each for violating file & use policy and protection of policy holders interest.

The company had made payments to the group master policyholders in the name of 'market research', 'sales training' and 'display of publicity material'.

News 20 - RBI imposes penalty on four cooperative banks

Reserve Bank of India

Reserve Bank of India (RBI) has imposed penalties on four cooperative banks for violation of various norms:

Bank Reason Amount
The Model Co-operative Urban Bank Ltd., Hyderabad, Telangana For violation of the Reserve Bank of India directives and guidelines on loans and advances to directors and their relatives Rs 1.00 lakh
Indapur Urban Co-operative Bank Ltd., Indapur, Dist : Pune For violations of the instructions / guidelines of the Reserve Bank of India relating to credit exposure norms on loans and advances and Know Your Customer (KYC)/Anti-money Laundering (AML) guidelines Rs 2.00 lakh
Shri Dadasaheb Gajmal Co-operative Bank Ltd., Pachora, Dist : Jalgaon For violation of the instructions / guidelines of the Reserve Bank of India relating to creation of floating charge on its assets without the prior permission of the RBI Rs 1.00 lakh
The Cooperative City Bank Ltd., Guwahati for violation of Know Your Customers Norms and Cash Transactions and non-adherence to requirements relating to identification and reporting of suspicious transactions Rs 5.00 lakh

News 21 - Federal Bank ties up with MMTC gold coin distribution

Gold Coin

Federal Bank announced its tie up with government-controlled Metals and Minerals Trading Corporation of India (MMTCI) for distribution of gold coins. The Indian gold coins are of 24 karat purity, 999 fineness and has the National Emblem of Ashok Chakra engraved on one side and the face of Mahatma Gandhi as in currency notes on the other.

With this the bank became the first private sector bank to distribute the gold coins presently available in denominations of five, 10 and 20 grams.

News 22 - India Post Payments Bank Incorporated

India Post Payments Bank

The India Post Payments Bank Limited has received the Certificate of Incorporation from the Registrar of Companies, Ministry of Corporate Affairs on 17th August,2016 under the Companies Act 2013. This would be the first PSU under the Department of Posts.

The Department of Posts is expected to complete the roll out of its branches all over the country by September 2017. This could be the fastest roll out for a bank anywhere in the world.

News 23 - SBI board approved merger of 5 associate banks, BMB with itself

SBI Board

The board of State Bank of India (SBI) cleared the proposed merger of five associate banks viz. State Bank of Bikaner and Jaipur (SBBJ), State Bank of Mysore (SBM), State Bank of Travancore (SBT), State Bank of Hyderabad and State Bank of Patiala as well as Bharatiya Mahila Bank (BMB) with itself.

Post-merger, SBI will become a global-sized bank with an asset base of Rs 37 trillion (Rs 37 lakh crore) or over USD 555 billion, with 22,500 branches and 58,000 ATMs. It will have over 50 crore customers.

News 24 - Doha Bank opens first branch in Kerala

Doha Bank

Qatar based Doha Bank is formally set to inaugurate its first branch in Kerala on 27th August. The branch is located at first floor of Lulu International shopping Mall in Edappally. It is the only branch of a Gulf Cooperation Council (GCC)-based bank in India.

It will mainly cater to the needs of the large NRI population, both in Kerala and the Gulf. Doha bank provides corporate banking, retail banking, treasury, trade finance and foreign exchange services.

News 25 - Federal Bank to use Chillr app

Chillr App

Federal Bank has partnered with Chillr. It is a mobile banking application that connects directly to a person’s bank account and enables instant money transfers, bill payments, phone recharge and e-commerce payments in a very secure environment.

It is India’s first and only multi-bank mobile application. Chillr allows users to connect seamlessly with multiple bank accounts and manage all their banking needs on a single platform. All transactions on Chillr are initiated directly from the users’ bank accounts and authenticated by a secure PIN provided by their banks.

News 26 - Government selects four investment banks for launch of IPO of HUDCO

IPO

Department of Investment and Public Asset Management (DIPAM), has selected four investment banks, Nomura, SBI Caps, ICICI Securities and IDBI Capital for the proposed share sale in HUDCO (Housing & Urban Development Corporation Limited).

The government is planning to sell 10% stake in HUDCO through an initial public offer (IPO). The proposed move is aimed at raising about Rs 1,500 crore on a total valuation of Rs 15,000 crore. HUDCO has a paid up capital of Rs 2,000 crore, comprising of 200 crore equity shares of Rs 10 each.

News 27 - South Indian Bank, SBI Card to launch co-branded credit card

SBI Card

South Indian Bank has collaborated with SBI Card, a credit card issuer, to launch cobranded credit cards for the customers of South Indian Bank. As per the agreement, two variants of credit card on VISA platform, namely South Indian Bank Platinum SBI card and South Indian Bank SimplySave SBI card will be launched.

While the Platinum card will be offered to the premium segment of the customers, the other card will be offered to those customers who look for value.

News 28 - UBI launches USSD based mobile app

USSD

National Payments Corporation of India (NPCI) has entered into an agreement with Union Bank of India to launch an USSD based *99# mobile application for their customers.

This application can be downloaded in an android smartphone from the Google Play Store by the bank customers and can be used even without any internet connection as it does not require any data. The application provides basic banking facilities like checking account balance, sending money and Mobile PIN (MPIN) management. It is also available in 10 languages.

News 29 - Bajaj Finance partners with India Post

Bajaj with Indian Post

Bajaj Finance Limited has signed a memorandum of Understanding with India Post to facilitate purchase of two-wheeler vehicles in Karnataka. Customers can collect information on the loan sch emes and offers from the post office. Subsequently, the customers can also make repayments of their loans through the Post Offices by making the deposits.

This arrangement shall initially be rolled out across 208 E-Payment Post Offices across Karnataka. The first such tie-up was made in Tamil Nadu.

News 30 - Government to ban cash transactions over Rs 3 lakh

SIT

Chairperson of the Central Board of Direct Taxes Rani Singh Nair said that the government is planning to ban all cash transactions of more than Rs. 3 lakh as per the recommendations of the Special Investigation Team (SIT).

The government, however, is yet to decide on the SIT's other proposal to bar cash holdings over Rs 15 lakh due to opposition from trade and industry. The government has already banned cash advance of more than Rs 20,000 for property transactions.

News 31 - Jawaharlal Nehru Port Trust to sign agreement with bankers for External Commercial Borrowing

JNPT

India’s premier container port, Jawaharlal Nehru Port in Navi Mumbai, has signed an agreement with State Bank of India and Development Bank of Singapore for External Commercial Borrowing to the tune of USD 400 Million (USD300 Million from the SBI & USD100 from DBS).

The ECB will be primarily utilized by the JNPT for expansion of its existing roads network connecting to its port project. Borrowing by JNPT is for Door-to-Door tenor of 7.5 years. However, lending by JNPT to MJPRCL is for 16 years (two years construction and 14 years repayment).

News 32 - 21 banks to go live with Unified Payments Interface

UPI

India's Unified Payments Interface (UPI) is going live for customers of 21 banks, paving the way for a P2P payments revolution in the country.

UPI is a new initiative from NPCI designed to enable customers across UPI member banks to pay and collect money from their smartphones without entering any bank account information. IDBI Bank and RBL Bank are onboarded as issuers. It enables their customers to download any UPI enabled Apps mentioned above and link their account.

News 33 - RBI asks banks to provide loans to Women Self-Help Groups at 7% per annum

RBI Provide Loans

Reserve Bank of India (RBI) has asked banks to provide loans to Women Self-Help Groups in rural areas at 7% per annum.

The Reserve Bank said in a notification that all women self-help groups (SHGs) will be eligible for interest subvention on credit up to three lakh rupees at 7% per annum under the Deendayal Antyodaya Yojana - National Rural Livelihoods Mission in 250 districts. However, SHGs availing capital subsidy under the Swarnajayanti Gram Swarozgar Yojana in their existing credit outstanding will not be eligible for benefit under this scheme.

News 34 - Karnataka Bank Launches new Mobile Banking App “KBL – SMARTz” on UPI platform of NPCI

KBL Mobile

Karnataka Bank today launched “KBLSMARTz”, a Mobile Application (App) built on Unified Payments Interface (UPI) platform of National Payments Corporation of India (NPCI). UPI is a new initiative from NPCI designed to enable customers across UPI member banks to pay and collect money from their smartphones without entering any bank account information.

“KBL –SMARTz” is “Secure Mobile App for Rapid Transactionz”. App is available to public free of cost and can be downloaded from the Google PlayStore.

News 35 - World Bank sanctions Rs 980 cr for Brahmaputra dredging: Min

World Bank

The World Bank has sanctioned Rs 980 crore to dredge the Brahmaputra as an initiative to develop waterways to Bangladesh and to other South East Asian countries. It will help boost trade and industry in the Northeast. It will ultimately result in Assam becoming an export hub for the South East Asian countries.

The World Bank is an international financial institution that provides loans to developing countries for capital programs.

News 36 - RBI Forecasts 7.6% GDP growth for this fiscal

Growth

The RBI, in its Annual Report, has projected India's growth rate at 7.6% in 2016-17, up from 7.2% last year as a result of better than anticipated agricultural performance and the possibility of allowances under the 7th Pay Commission's award being paid out in the fourth quarter of 2016-17.

The report highlights that the passage of Goods and Services Tax (GST) Bill marks and the commitment of the central government to the path of fiscal consolidation in 2016-17 has enhanced the credibility of fiscal policy, which will, in turn, help in anchoring inflation expectations and in improving the business environment.

News 37 - NABARD sanctions Rs 204.67 crore loan under RIDF to Haryana

NABARD

The National Bank for Agriculture and Rural Development (NABARD) has sanctioned a loan of Rs 204.67 crore for Haryana unde r Rural Infrastructure Development Fund (RIDF) for rural infrastructure in Haryana including a 10MW solar plant at Panipat thermal power station.

Out of the total loan, Rs 147.18 crore has been sanctioned to the state government for construction of three rural bridges, construction and upgradation of 26 rural roads in 10 districts, and Rs 57.49 crore for the solar plant. The aggregate length of the proposed rural roads is 184.78 km.

News 38 - PhonePe & YES Bank launch India’s 1st UPI-based payments app

PhonePe

PhonePe, a Flipkart Group company, and YES BANK have partnered to launch India’s first UPI (Unified Payments Interface) based mobile payments app.

PhonePe allows users to link their bank accounts securely to their smartphone using NPCI’s encrypted libraries. Once linked, users can authorize money transfers or merchant payments instantly by simply entering their 46 digit MPIN.

Money is instantly transferred without a need to enter an OTP to authorize a transaction anymore. A transaction takes less than 10 seconds to complete. The PhonePe App also offers bill-split, mobile recharge and utility bill payment features.



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