Current Affairs August 2018 - Finance
1 - Cabinet approved dilution of Government shareholding below 50% in IDBI Bank
The Union Cabinet has approved conveying of no objection to reduction in Government of India shareholding in IDBI Bank Limited to below 50% by dilution.
The Union Cabinet has also approved acquisition of controlling stake by Life Insurance Corporation of India (LIC) as promoter in the bank through preferential allotment/open offer of equity, and relinquishment of management control by the Government in the bank.
2 - NHAI signed MoU with SBI for a Long Term, unsecured Loan of Rs. 25,000 Crore
National Highways Authority of India (NHAI) has signed a MoU with State Bank of India for an unsecured loan of Rs. 25,000 crores for 10 years with 3 years of moratorium on repayments. This is the largest amount of loan to have been sanctioned to NHAI in one stroke by any institution. This is also the largest long term unsecured loan sanctioned by SBI at a time to any entity.
There is no principal repayment liability for initial three years. After three years, the repayment would be done in 14 equal half yearly installments. NHAI can repay/prepay it at any time without any prepayment penalty.
3 - RBI increased Repo Rate by 25 bps to 6.5%
The Reserve Bank of India's (RBI) six-member monetary policy committee has raised policy rates by 25 basis points to 6.5%. RBI had also hiked interest rates by 25 basis points in its June meeting. Consequently, the reverse repo rate under the LAF stands adjusted to 6.25%, and the marginal standing facility (MSF) rate and the Bank Rate to 6.75%.
RBI also raised the average inflation projection for the second half of the year to 4.8% from 4.7% in June. The central bank expects inflation to edge higher to 5% in the first quarter of next fiscal year.
4 - Mauritius’s SBM received RBI nod for subsidiary
Mauritius-based SBM Group has received Reserve Bank of India’s approval to operate in the country through a wholly-owned subsidiary route. SBM is the first foreign lender to receive such a licence after local incorporation was introduced in 2013. The bank will soon operate as a banking subsidiary of SBM Group in India under the name of SBM Bank (India) Ltd.
SBM currently operates through four branches, in Mumbai, Chennai, Hyderabad and Ramachandrapuram. Singapore’s DBS Bank is another lender which is awaiting final approval from the RBI to convert its 12 branches into a wholly owned subsidiary.
5 - PayPal and HDFC Bank united to offer seamless payment experiences
PayPal united with HDFC Bank to offer ease to customers for making any payments. PayPal customers will be offered HDFC cards as a payment option during enrolment and subsequent payments, with the ability for consumers to easily open PayPal accounts and set it as their preferred payment method.
PayPal Holdings, Inc. is an American company operating a worldwide online payments system. HDFC Bank Limited is an Indian banking and financial services company that offers wide range of personal banking services.
6 - HSBC launched Online Platform 'MyDeal' To Raise Funds via Capital Markets
In order to expand digital services in capital markets for customers, HSBC bank launched new digital platform 'MyDeal'. MyDeal will provide range of services to capital markets customers such as real-time access to information of investors' feedback, profiles, client orders and deal pricing. It is done with an aim to raise funds via capital and ease capital raising process through capital markets.
MyDeal newly launched app has raised over USD 25 billion through over 30 transactions globally.
7 - RBI to pay ?50,000 crore dividend for 2017-18
Reserve Bank of India has decided to pay its surplus money of Rs. 50,000 crore to the Government of India, as dividend payout for the financial year 2017-18. It is considered to be the highest since 2015-16. This surplus money paves way for government to allow more infusion of capital into the banks it owns.
Government had injected Rs. 2.11 trillion into public sector banks through a mix of recapitalization bonds (Rs. 1.35 trillion), direct infusion from budgetary allocations (Rs. 18,000 crore) and market borrowing (Rs. 58,000 crore).
8 - PayU and Reliance Money united for Instant Loan service
Reliance Money and PayU India entered into partnership to offer instant app-based personal loans to PayU customers via app named as LazyPay. LazyPay will offer personal loan of minimum amount Rs. 100 and maximum of Rs. 1 lakh for duration ranging from 15 days to 24 months. One of the key benefits of this app is that customers don’t have to visit any branch or involve into any hassle process.
Personal loan service will be completely digital where Reliance Money would carry out its one-step due diligence of checking the credit worthiness of the customers via complete KYC of customer.
9 - Mobile wallet transactions stood at Rs. 14,632 crores in June
Reserve Bank of India reported record breaking Rs. 14,632 crore value of transactions made through mobile wallets in the month of June 2018. There was 4.2% growth observed as compared to ?14,047 crore as of May 2018. Reserve Bank of India has issued strict guidelines for wallet users to follow strict KYC guidelines.
The volume of transactions was also reported to be crossing the 300 million mark for the first time. According to RBI data provided, payments using real-time gross settlement (RTGS) fell marginally by around 0.5% to 11.43 million in June.
10 - SBI launched unified payment terminal MOPAD
State Bank of India has launched Multi Option Payment Acceptance Device (MOPAD). It is a unified payment terminal where customers can make payments through cards, Bharat QR, UPI and SBI Buddy on a PoS terminal. This multi-option acceptance device is a one-step solution to all types of payment types. This will also provide ease to merchants in their business and bring more digitization among customers.
SBI has rolled out this facility with 6.23 lakh terminals. A merchant can benefit by making many transactions on single terminal.
11 - Wholesale inflation eased to 5.09% in July
Wholesale inflation eased to 5.09% in July on account of cheaper food articles, especially fruits and vegetables. The Wholesale Price Index based inflation was recorded at 5.77% in June. The wholesale inflation in food articles was -2.16% in July as against 1.80% in June.
Vegetable prices fell by 14.07% in July as compared to a growth of 8.12% in June. There was an 8.81% fall in wholesale prices of fruits in July as against a rise of 3.87% in June.
12 - RBI net sells USD 6.184 bn of US currency in June
According to data released by Reserve Bank, the apex bank continued to remain net seller of the US currency for the third consecutive month in June 2017, after it sold USD 6.184 billion of the US dollar in the spot market.
RBI bought USD 4.020 billion of the US dollar, while sold USD 10.204 billion in the spot market. In May and April, RBI had net sold USD 5.767 billion and USD 2.483 billion of the US dollar, respectively.
13 - Exim Bank inked MoU with BRICS development banks
Exim Bank of India inked a multilateral cooperation agreement, along with Presidents of other member development banks of BRICS (Brazil, Russia, India, China, and South Africa) nations, expressing their intent to undertake collaborative research on blockchain technology. The blockchain technology replaces the old processes and paperwork with a new-found innovative process and reduces the cost of cross border payments.
Under this MoU, the signatories have agreed to constitute a Joint Research Working Group which will formulate the research agenda and targeted outcomes. Exim Bank of India is the nominated member development bank under the BRICS Interbank Cooperation Mechanism.
14 - Axis Bank became first bank to bring iris authentication for Aadhaar-Based Transactions
Axis Bank has become the first bank in the country to introduce Iris Scan Authentication feature for Aadhaar-based transactions through its micro ATM tablets. This service requires a customer to scan their iris on a tablet. Micro ATMs completely eliminate the requirement of debit cards, passwords, PINs, user IDs, etc., and empower consumers to avail banking services using only their Aadhaar numbers and biometrics (iris scan/fingerprint scan).
Axis Bank is presently running a pilot program for its customers at 8 branches and exploring iris-based Aadhaar authentication for varied services such as loan processing, insurance, eKYC account opening and others.
15 - Bajaj Allianz General Insurance and Vijaya Bank signed bancassurance deal
Bajaj Allianz General Insurance and Vijaya Bank inked a bancassurance deal to enable distribution of Bajaj Allianz General Insurance products through bank’s extensive network of 2,129 branches across the India. Under this strategic tie-up, Bajaj Allianz General Insurance will offer personal lines of insurance products such as health, personal accident, home, motor and travel along with commercial line of insurance products such as property, marine, liability and engineering insurance etc., to the bank’s customers.
The partnership will strengthen distribution network of Bajaj Allianz General Insurance in southern India as Vijaya Bank has strong foot hold in South India.
16 - Bharti Axa in union with Airtel Payments Bank to offer Jeevan Jyoti Bima
Airtel Payments Bank & Bharti AXA Life Insurance has announced a first-of-its-kind alliance to offer the ‘Pradhan Mantri Jeevan Jyoti Bima Yojana’ (PMJJBY), a government-backed life insurance scheme. ‘Pradhan Mantri Jeevan Jyoti Bima Yojana’ (PMJJBY) provided by Bharti AXA Life Insurance offers Rs. 2 lakh life insurance cover for a nominal premium of Rs. 330 per annum and can be purchased by all existing or new Airtel Payments Bank savings bank account.
Airtel Payments Bank becomes the first payments bank in India to offer PMJJBY. It will be initially available at 100,000 Airtel Payments Bank - Banking Points.
17 - No ATM to be replenished with cash after 9 pm from 2019
No ATM will be replenished with cash after 9 PM in cities and 6 PM in rural areas from 2019. In a notification, Home Ministry directed the deadline for putting money in the ATMs located in Naxal-hit areas as 4 PM. Private cash handling agencies must collect money from the banks in the first half of the day and transport notes only in armed vehicles.
The decision has been taken in view of the spurt in incidents of attacks on cash vans, cash vaults, ATM frauds and other internal frauds leading to increased sense of insecurity.
18 - Google Tez renamed as Google Pay to offer instant bank loans
California-based Alphabet Inc’s Google Company renamed its Made-in-India Tez app as 'Google Pay'. The company partnered with HDFC Bank Ltd., ICICI Bank Ltd., Kotak Mahindra Bank Ltd. and Federal Bank Ltd. to provide instant loans to customers. Google Pay is the faster way to pay online, in stores, and across Google using the cards from Google account. Google Pay will be offered instant loans and will be able to pay instant loans through the service.
Google Pay also provides promotional coupons, instant mobile recharges, gifting options etc. It claims to have over 750 million transactions by over 22 million users.
19 - DBS honored as world's best bank in nod to its digital innovation
In a first for a Singapore and Asian bank, DBS Bank has overtaken larger, more established banks to be named Best Bank in the World. The prestigious top award was conferred to DBS by Global Finance in its World’s Best Global Banks 2018 Awards. Prior to this, bank was crowned World’s Best Digital Bank by Euromoney for the second time in three years. It was also named World’s Best Bank for SMEs.
DBS Bank is a multinational banking corporation headquartered in Marina Bay, Singapore. DBS Bank is a leading financial services group in consumer banking, treasury, equity and debt fund-raising.
20 - Department of Financial Services reported PNB as top rank in digital transaction
Department of Financial Services report unveiled that Punjab National Bank (PNB) is topmost bank in providing digital services or having digital transactions. Punjab National Bank is rated at 6th place with score of 71 amongst all banks in India for digital performance. PNB is given ‘Good’ rating by the government. The average percentage of technical declines of digital transactions of Punjab National bank customers is only 0.83 per cent of total transactions.
Punjab National Bank is an Indian multinational banking and financial services company based in Delhi.
