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RBL Bank empaneled as Agency Bank by RBI
The accreditation comes on the heels of the RBI’s guideline authorizing scheduled private sector banks as Agency Banks to carry out specific government-related business transactions
- Recently RBI approved Karnataka Bank, IndusInd Bank as Agency Bank to govt business.
The authorization will enable RBL Bank, to handle a broad range of transactions related to government business, such as distributing subsidies, pension payments, collecting Central and State taxes including income tax, excise duties, customs, GST, stamp duty, registration, value added tax and professional tax, in both online and offline modes
Strengthen systems to monitor availability of cash, RBI to banks, White Label ATM operators
The Reserve Bank of India has asked banks and White Label ATM Operators (WLAOs) to strengthen their systems to monitor availability of cash in ATMs and ensure timely replenishment to avoid cash-outs, failing which monetary penalty will be imposed on them.
Scheme of penalty
In this regard, RBI has come out with a “Scheme of Penalty for non-replenishment of ATMs”, which will be effective from October 1, 2021. Cash-out (when the customer is not able to withdraw cash due to non-availability of cash in a particular ATM) at any ATM of more than ten hours in a month will attract a flat penalty of ₹10,000 per ATM.
In case of White Label ATMs (WLAs), the penalty would be charged to the bank which is meeting the cash requirement of that particular WLA. The bank may, at its discretion, recover the penalty from the WLA operator.
SIDBI launches ‘Digital Prayaas’ app for providing loans
Small Industries Development Bank of India (SIDBI) has launched ‘Digital Prayaas’, an App based end to end digital lending platform, whereby loan sanction will be accorded to aspiring entrepreneurs from the bottom of the pyramid by the end of the day.
- Further, to cater to the aspiring youth in urban areas, SIDBI tied up with a major grocery aggregator BigBasket to on board its delivery partners across the country and provide loans at an affordable interest rate for purchase of environment friendly e-Bikes and e-Vans.
Chairman and Managing Director, SIDBI - Sivasubramanian Ramann
RBI moves to ease overseas direct investment regulations under FEMA
The Reserve Bank of India is planning to rationalize the existing provisions governing Overseas Direct Investment (ODI) regulations under the Foreign Exchange Management Act (FEMA), 1999.
This is to further liberalize the regulatory framework and promote ease of doing business, per the RBI’s draft Foreign Exchange Management/FEM (Non-debt Instruments - Overseas Investment) Rules, 2021 and the draft Foreign Exchange Management (Overseas Investment) Regulations, 2021.
- What is Overseas Direct Investment? ODI outside India means investments, either under the Automatic Route or the Approval Route, by way of contribution to the capital or subscription to the Memorandum of a foreign entity or by way of purchase of existing shares of a foreign entity either by market purchase or private placement or through stock exchange, signifying a long-term interest in the foreign entity
India has 136 ‘billioniare’ individual taxpayers
The Finance Ministry on Tuesday informed the Rajya Sabha that the number of individual taxpayers with incomes of ₹1 billion or more nearly doubled in the Assessment Year 2019-20 (Fiscal Year 2018-19) but dipped in AY20-21 (FY 2019-20).
In her written reply to a question on the number of billionaires, Finance Minister Nirmala Sitharaman clarified that there is no legislative or administrative definition of the term billionaire under direct taxes. With wealth tax abolished, the CBDT no longer captures information about the complete wealth of an individual taxpayer.
- She said the number of individuals disclosing a gross total income of more than ₹100 crore during AY2018-19 was 77, which rose to 141 the next year but dipped to 136 in AY 2020-21.
The Government does not consider crypto-currencies legal tender or coin, says Minister
To another question, Minister for State for Finance Pankaj Chaudhary said in a written reply, “The Government does not consider crypto-currencies legal tender or coin and will take all measures to eliminate use of these crypto-assets in financing illegitimate activities or as part of the payment system"
- The government will explore use of block chain technology proactively for ushering in digital economy.
Further, he said that the Inter-Ministerial Committee to study the issues relating to Virtual Currencies, had recommended that all cryptocurrencies, except any issued by the state, be prohibited in India
Jan Dhan Inoperative Accounts
Minister of State for Finance Bhagwat Karad said, “The total inoperative accounts under PMJDY as on 28.07.2021 are approx. 5.82 crore.
- Out of the total, women inoperative accounts are approx. 2.02 crore. This constitutes around 35 per cent of total inoperative accounts.
- According to the PMJDY website, Jan Dhan accounts total 42.83 crore with a balance of nearly ₹1.43 lakh crore.
Consultant for MARS: Pension regulator comes with new RFP
Pension regulator Pension Fund Regulatory & Development Authority (PFRDA) has come up with a new Request for Proposal (RFP) for appointment of a consultant to help design a Minimum Assured Return Scheme (MARS) under the National Pension System (NPS).
- The new RFP has relaxed the eligibility criteria set earlier for a bidder and has now allowed those with experience of designing or development of at least one scheme with guarantee for its client, to bid for the consultant role
The earlier RFP mandated that a bidder, which has to be a corporate entity registered in India, should have experience of designing or development of schemes of guarantee with at least three schemes being in operation or running in India, after being offered by its clients to the public at large
What is Minimum Assured Return Scheme (MARS)?
- The whole idea behind having MARS is to have a separate scheme that can offer a guaranteed minimum rate of return to NPS subscribers, especially those who are risk averse. Currently, the NPS gives returns annually, based on prevailing market conditions.
- The appointed consultant, with requisite actuarial skills, is expected to help formulate or design a MARS that can be offered to existing and prospective subscribers by the pension funds.
India’s pension assets under management have already crossed the ₹6 lakh crore mark and are expected to touch ₹7.5 lakh crore by end March this fiscal. PFRDA is aiming for AUM of ₹30 lakh crore by the year 2030.
Asset quality risks on rise, but Indian banks can absorb loss: Moody's
The asset quality risks for banks will rise in most parts of ASEAN and India, as the region battles new waves of coronavirus infections amid low vaccination rates. Yet the continued policy support and strong loss-absorbing buffers will help to mitigate the negative impact, according to rating agency Moody's.
- For India (Baa3 negative), the economy will return to growth in the fiscal year ending March 2022. But, the severe second coronavirus outbreak will delay improvements in asset quality.
