Current Affairs January 2018 - Finance
1 - Parliament passed NABARD (Amendment) Bill, 2017
Parliament passed the National Bank for Agriculture and Rural Development (Amendment) Bill, 2017. The Bill seeks to amend the National Bank for Agriculture and Rural Development Act, 1981. The Bill allows the central government to increase the authorised capital of the Bank from Rs. 5,000 crore to Rs. 30,000 crore. The capital can be increased further by the government in consultation with the RBI.
NABARD is responsible for providing and regulating facilities like credit for agricultural and industrial development in the rural areas.
2 - Customers will not be charged on debit card transactions up to ?2,000
Union Cabinet approved a proposal that government will bear the merchant discount rate (MDR) charges on transactions up to Rs 2,000 made through debit cards, BHIM UPI or Aadhaar-enabled payment systems to promote digital transactions. Customers will not have to pay any transaction charges for payments through debit card, BHIM app and other payment made for up to Rs 2,000.
Merchant discount rate (MDR) will be borne by the government for two years with effect from January 1, 2018 by reimbursing the same to banks.
3 - Andhra Pradesh Grameena Vikas Bank operationalized desktop ATMs in Rural India
Andhra Pradesh Grameena Vikas Bank (APGVB) started operations of its first desktop mini ATM in rural area of Telangana. This is done to facilitate customers to withdraw small amounts within the branch premises. The first such mini ATM is inaugurated at Kasibugga in Mandi Bazar of Warangal in Telangana. Around 100 more desktop ATMs in different busy branches will be installed.
Desktop ATMs are designed to work in harsh climatic conditions and with minimum power requirements.
4 - HDFC Bank partnered with Rajasthan Government to promote Start-Ups
HDFC Bank entered into a partnership with Government of Rajasthan to promote and nurture the start-ups in the state. Under the MOU, HDFC Bank will partner with the state Government to provide end-to-end solutions like current accounts, credit cards and other solutions to start-ups under SmartUp programme of HDFC Bank. Further, the Bank will not only evaluate the offerings by Startups in Rajasthan but also given them an opportunity to showcase their solutions/technologies.
The bank's new SmartUp portal, start-ups will be able to tap into the knowledge and experience of a complete network of start-ups.
5 - SBI and NABARD to promote Joint Liability Groups in Bengal
NABARD in union with SBI will promote 2,500 joint liability groups (JLGs) in selected districts of the Bengal. Both have signed MoU with 5 NGOs. With this, NABARD will be able to achieve its target of credit linking 80,000 JLGs in West Bengal in 2017-18.
Under this MoU, NABARD will provide financial assistance of 60,000 JLGs by various NGOs through 339 projects in different districts and Joint Liability Groups are the 4-10 membered groups of tenant farmers who take responsibility to repay loans taken by the group from a bank.
6 - RBI Bonds scheme replaced by 7.75% savings bonds scheme
Government of India announced to launch 7.75% Savings (Taxable) Bonds, 2018 replacing 8% GoI Savings (Taxable) Bonds, 2003, to enable resident citizens/HUF to invest in a taxable bond, without any monetary ceiling. The Bonds are open to investment by individuals (including Joint Holdings) and Hindu Undivided Families. NRIs are not eligible for making investments in these Bonds. Interest on the Bonds will be taxable under the Income-tax Act, 1961.
7 - RBI imposed PCA on Allahabad Bank
RBI has triggered Prompt Corrective Action against Corporation Bank and imposed certain restrictions on it due to high non-performing loans, insufficient CET1 Capital and negative ROA for two years in a row. RBI has earlier placed restrictions on 10 banks which such as Oriental Bank of Commerce, Dena Bank, Central Bank of India and UCO Bank. Banks are placed under PCA on basis of Risk Based Supervision Model.
Once RBI initiates PCA against a bank, it can’t open branches, recruit staff, or give employee increments, and can disburse loans only to companies with borrowing above investment grades.
8 - IICA and IPPB inked MoU to provide training on payment banking
Indian Institute of Corporate Affairs (IICA) and India Post Payments Bank (IPPB) signed an agreement for the training of employees of India Post Payments Bank. IICA has been entrusted with the key responsibility of capacity building of IPPB through training of its officials/employees.
Training takes a central role as it impacts the operational efficiency as well proper utilisation of available technology. It will be agents? and bankers? understanding and initiative that will alleviate the fear of technology.
9 - Paytm Payments Bank partnered with IndusInd bank for FD facility
Paytm Payments Bank partnered with Induslnd Bank to introduce a first-of-its kind facility to create a linked Fixed Deposit. Fixed deposit will have sweep out facility with balance exceeding Rs 1 lakh, providing 6.85 percent annual interest. Customers can redeem their deposit instantly, anytime without paying any pre-closure or miscellaneous charges. Senior citizens FDR will be on auto renewal mode under senior citizen scheme.
Paytm Payments Bank offers banking services and accept deposits of upto Rs. 1 lakh per customer in a Savings Account.
10 - RBI approved TIHCL to operate as NBFC
Telangana Industrial Health Clinic Limited received RBI nod to register itself and work as a non-banking finance company (NBFC). Telangana Industrial Health Clinic Limited will be the first state promoted and co-financing NBFC. The company received SKOCH Platinum Award in September 2017 under the smart governance category in the MSME segment.
Telangana Industrial Health Clinic Ltd has been appreciated for implementing the resolution of stressed assets in micro and small manufacturing enterprises which the faced from banks.
11 - IndusInd Bank introduced India’s first battery-powered interactive payment card
IndusInd Bank in partnership with Dynamics Inc. announced plans to introduce the first battery-powered, interactive payment cards to the Indian market in 2018.
The new card has multiple buttons that let the consumers use a single card to pay in multiple ways. With a touch of a button consumers can select credit, points or monthly installments as payment option. A different color light will activate based on the selected payment option.
12 - Paytm announced set up of Paytm Money Ltd
Paytm announced the setting up of 'Paytm Money Limited', a wholly owned subsidiary of One97 Communications to build investment of $10 million by creating a new entity. Paytm Money is meant for offering investment and wealth management solutions to customers. Paytm will have to seek approval from SEBI for acting as an investment advisor.
One97’ has presented 4th product named as Paytm money ltd, after Paytm Mall, Paytm Payments Bank and Paytm wallet.
13 - Flipkart's PhonePe inked MoU with FreeCharge
FreeCharge has partnered with Flipkart’s payments arm PhonePe so that existing Freecharge wallets of customers will be able to link PhonePe used by45 million users. Customers will easily be able to pay money using PhonePe using Freecharge wallets. Customers can pay on MakeMyTrip, PVR, Cleartrip, 1mg, FreshMenu, Cafe Coffee Day, Apollo Pharmacy, KFC, Barista, Spencer’s and FoodWorld.
FreeCharge is an e-commerce website to recharge any prepaid mobile phone, postpaid mobile, DTH & Data Cards in India. PhonePe is a Fin-Tech company that provides online payment system based on Unified Payments Interface.
14 - PNB inked MoU with NSFDC for assisting SC Families
Punjab National Bank and National Scheduled Castes Finance and Development Corporation (NSFDC) have tied up to provide financial assistance for economic empowerment of persons belonging to Scheduled Cast (SC) families living below Double Poverty Line (DPL).
PNB, through its huge network and customer base, would act as Channelizing Agent (CA) for the loan schemes of NSFDC whereas NSFDC will provide concessional finance for setting up of self-employment projects and skill-training grants to unemployed SC persons living below the Poverty Line.
15 - India becomes top borrower from AIIB in 2017
India became the top borrower from the China-sponsored Asian Infrastructure Investment Bank (AIIB) with USD 1.5 billion worth of loans in 2017 and USD three billion more in the pipeline. Indonesia has emerged as the second largest borrower with about USD 600 million loans.
AIIB has a total authorised capital of USD 100 billion. China is the largest shareholder with 26.06% voting shares while India is the second largest shared holder with 7.5% voting rights. AIIB charges about 1% to 1.5% interest with long term repayment including five-year grace period.
16 - Capital First to Merge With IDFC Bank in an All-stock Deal
IDFC Bank and Warburg Pincus-backed non-banking financial company Capital First will merge in a share swap deal valued at about $1.5 billion.
According to terms of the deal, shareholders in Capital First will receive 139 shares of the bank for every 10 shares held. Capital First’s founder and Chairman V. Vaidyanathan will become chief executive of the combined entity. Post-merger, the combined entity will have an AUM of Rs 88,000 crore; PAT of Rs 1,268 crore (FY17).
17 - BSE's India International Exchange lists IRFC's first Green Bond
BSE's India International Exchange (India Inx) has listed Indian Railways Finance Corporation's (IRFC) first green bond on its global securities market. The 10 year $500 million worth bonds have an annual yield of 3.835% and are one of the highest credit rated bonds issued by an Indian corporate.
BSE's India Inx, which was inaugurated on January 9, 2017, is the country's first capital raising platform for international investors in any currency.
18 - Bank of Baroda partnered with Invoicemart as a TReDS partner
Bank of Baroda has tied up with digital invoice marketplace Invoicemart to discount invoices for MSMEs. Buyers and sellers registered on the marketplace will now be able to access funding from Bank of Baroda.
TReDS is an online mechanism that helps MSMEs unlock working capital without the hassle of applying for loans. Invoicemart a joint venture between Axis Bank and mjunction services ltd.
19 - WhatsApp unveiled seperate Android app for small businesses
WhatsApp has launched separate Android app for small businesses that will allow companies to set up dedicated business profiles. It will help such businesses connect with their customer base in a more official way.
The app is currently available on Android and is free to download. It allows to create profiles containing information such as a business description, email or premises addresses, and website details. It has been rolled initially in Indonesia, Italy, Mexico, the UK and the US.
20 - Yes Bank signed a MoU with Amplus Energy Solutions for strategic Solar Power tie-up
Amplus Energy Solutions has signed an MoU with Yes Bank for a strategic tie-up to co-finance solar energy projects. otal projects capacity is expected to be up to 1,000 MW under the partnership. These projects would be developed by Amplus by 2023.
The memorandum of understanding (MoU) was signed at International Solar Alliance pavilion at the World Future Energy Summit, Abu Dhabi. Yes Bank and European Investment Bank had in December 2017 announced about creation of a fund of $400 million to fund solar and wind projects in India.
21 - Government to infuse over Rs 88,139 crore in 20 PSBs
The government has announced Rs 88,139 crore capital infusion in 20 Public Sector Banks (PSBs) during the current fiscal to boost lending and revive growth. The capital infusion plan for 2017-18 includes 80,000 crore rupees through Recapitalization Bonds and 8,139 crore rupees as budgetary support.
| Public Sector Banks | Budget |
|---|---|
| IDBI Bank | Rs 10,610/- Cr |
| SBI | Rs 8,800/- Cr |
| Bank of India | Rs 9,232/- Cr |
| UCO Bank | Rs 6,507/- Cr |
| PNB | Rs 5,473/- Cr |
| Bank of Baroda | Rs 5,375/- Cr |
| Central Bank of India | Rs 5,158 Cr |
22 - NIIF to set up $3-billion investments, partnering platform with DP World
The National Investment and Infrastructure Fund (NIIF) has partnered with Dubai-based ports operator DP World Pvt. Ltd for creation of an investment platform up to $3 billion for ports, terminals, transportation and logistics businesses in India.
NIIF is India’s first sovereign wealth fund. It is the first investment platform from NIIF. NIIF was created to catalyse capital from international and domestic investors into energy, transportation, housing, water, waste management and other infrastructure and allied sectors in India.
23 - IOB signed MoU with NHB for rural housing
Indian Overseas Bank has signed an MoU with National Housing Bank for the Rural Housing Interest Subsidy Scheme (RHISS) of the Ministry of Rural Development.
The interest subsidy under the scheme is 3% for a loan amount of ?2 lakh for 20-year tenure. All the rural households whose name does not appears in the permanent wait list of Pradhan Mantri Awas Yojana – Gramin are eligible to apply under RHISS.
24 - RIL became first Indian company to cross Rs 6 trillion market cap
Reliance Industries Ltd (RIL) became the first Indian company to cross Rs6 trillion market capitalisation after its shares hit an all-time high of Rs958.20. Currently, its market cap is at Rs6.02 trillion.
The stock added nearly Rs3 trillion market cap since April after its telecom arm Reliance Jio started charging its customers. Tata Consultancy Services follows RIL with market capitalisation of ?5,95,946 crore. HDFC Bank became the first bank to cross market capitalisation of ?5 lakh crore.
25 - Small Finance and Payments banks to offer Atal Pension Yojana
10 Small Finance Banks and 11 Payment Banks have got license from Reserve Bank of India to offer Atal Pension Yojana, APY in the country.
At present over 84 lacs subscribers are registered under the APY scheme with an asset base of more than 3,194 crore rupees. Under the scheme, a subscriber would receive a minimum guaranteed pension of 1,000 to 5,000 rupees per month from the age of 60 years depending upon the contribution.
