Banking and Finance Current Affairs | April, 2021
Read Current Affairs on Quickbytes and stay updated with latest Current Affairs events on daily basis. Our daily Current affairs on Banking and Finance in April 2021 are for all those aspirants preparing for various competitive exams and entrance tests like Bank PO & Clerk, IBPS PO, Insurance SSC, PSC, UPSC and more.
Banking and Finance - April 2021
|27th April, 2021|
RBI caps the tenure of MDs and CEOs of private sector banks to 15 years
Reserve Bank of India has capped the maximum tenure of the Managing Directors (MDs), Whole Time Directors (WTDs) and Chief Executive Officers (CEO) of the private sector banks to 15 years. RBI has also placed a maximum age limit for appointment of the individuals as MD, CEO and WTD in the private sector banks to 70 years. However the norms mandated for the private sector is not applicable to the state-run as well as foreign banks. RBI has also stipulated that the individuals seeking reappointments into the same entity directly or indirectly will not approved during the cooling off period of 3 years.
|26th April, 2021|
IRDAI allows investments in Debt Securities of REITs and InvITs
Insurance Regulatory and Development Authority of India (IRDAI) has allowed the investors to make investments in Debt Securities issued by Real Estate Investment Trusts (REITs) and Infrastructure Investment Trusts (InvITs). The investments in debt instruments of REITs and InvITs which are rated above AA have been allowed for investments under ‘approved investments’ category. As per the regulations of IRDAI, REITs are a part of ‘Real Estate Activities’ industry group whereas InvITs are a part of ‘Infrastructure Investment’ group.
|23rd April, 2021|
RBI restricts American Express and Diners Club from enrolling new customers
Reserve Bank of India (RBI) has restricted American Express Banking Corp and Diners Club International Ltd from adding new customers to their card networks from 1st May, 2021. The restrictions have been imposed as a result of non-compliance with the directives on Storage of Payment System Data. American Express and Diners Club have been authorized to operate card network across India under the Payment and Settlement Systems (PSS) Act, 2007. Under the PSS Act, all the data related to payment systems will be stored in India itself from October, 2018.
RBI cancels Bhagyodaya Friends Urban Co-operative Bank’s license
Reserve Bank of India (RBI) has cancelled the Banking license of Maharashtra-based Bhagyodaya Friends Urban Co-operative Bank. It has been prohibited from making the business of banking due to inadequate capital for paying back the customers of the bank. RBI has restricted the bank from accepting deposits or repaying the deposits under the Banking Regulation Act, 1949. More than 98 % of the depositors of the bank will receive all their deposits from Deposit Insurance and Credit Guarantee Corporation (DICGC) under the DICGC Act, 1961.
|22nd April, 2021|
BFSL and Mastercard jointly launch world’s 1st QR on card Program for supporting MSMEs
Baroda Financial Solutions Limited (BFSL) in partnership with Mastercard has launched the world’s 1st Quick Response (QR) on card program for supporting the Micro, Small and Medium Enterprises (MSMEs). The program has been named as ‘ConQR’. The ConQR credit card’s face will have a Bharat QR Code that will work on the technology patented by Mastercard. This will help in hassle free transactions using the QR code embedded credit card. Besides making payments, the QR code will also provide basic details of the enterprise.
RBI to cancel the Banking license of Sambandh Finserve
Reserve Bank of India (RBI) will cancel the Banking license of Odisha-based Sambandh Finserve after its net worth fell below the minimum level. RBI has also issued a show-cause notice to the fraud-hit bank. MD & CEO of Sambandh Finserve, Deepak Kindo has been arrested by the Economic Offence Wing, Chennai as the main perpetrator of the fraud. There was a sharp depreciation in the bank’s net worth in the last two months which is beyond redemption. Sambandh Finserve has registered itself as an NBFC-MFI (Non-Banking Financial Company-Mutual Fund Institution).
|21st April, 2021|
Bitex becomes the 1st cryptocurrency exchange in India to disclose Investment Declaration reports
UAE-based crypocurrency exchange platform, Bitex has become the 1st cryptocurrency exchange in India to issue Investment Declaration Reports for all the retail and institutional investors of Bitex. This action has been taken by Bitex in compliance with the amendments made to the Companies Act 2013. The Schedule III of Companies Act 2013 was amended by the Ministry of Corporate Affairs (MCA) for mandating the companies to disclose their dealings in cryptocurrency. The report will contain information related to the sale and purchase of cryptocurrency by the investors.
|20th April, 2021|
Ministry of Finance includes healthcare sector in ECLGS 2.0
Ministry of Finance has widened the scope of Emergency Credit Line Guarantee Scheme (ECLGS) by including Healthcare sector that comes under Special Mention Accounts-1 (SMA-1). ECLGS 2.0 currently has borrowers from 26 sectors as identified by the KV Kamath Committee of Reserve Bank of India (RBI). The revised guidelines were issued by National Credit Guarantee Trustee Company Ltd (NCGTC). The ELCGS 2.0 will be valid till 30th June, 2021 or till the time when the Target Credit Line of INR 3 lakh crore is reached. INR 2.47 lakh crores out of INR 3.0 lakh crores have already been sanctioned till February, 2021 under the scheme.
|19th April, 2021|
RBI sets up Review Committee for looking into the working of ARCs
Reserve Banking of India (RBI) has formulated a Review Committee for looking into the working of Asset Reconstruction Companies (ARCs) in resolution of stressed debts. The committee will be headed by former RBI Executive, Sudarshan Sen. The committee will also look into the business model of the ARCs and will review their existing legal and regulatory framework. The committee includes Vishakha Mulye, PN Prasad, Rohit Prasad, Abizer Diwanji and R Anand. The committee will submit its report after 3 months.
|17th April, 2021|
SEBI issues guidelines for Warehousing Norms for Agri and Non- Agri Goods
Securities and Exchange Board of India (SEBI) has issued guidelines for Warehousing Norms for Agricultural and Non-Agricultural Goods through the Clearing Corporations (CCs). The newly issued guidelines will be enforced from 1st June, 2021. As per the guidelines, the Warehouse Service Providers (WSPs) should comply with the norms laid down by the Warehousing Development and Regulatory Authority (WDRA). The guidelines also say that in the event of insolvency of the WSP, the CCs should remove the WSP from the accredited list of warehouses.
|16th April, 2021|
ETMONEY launches India’s first Aadhaar-based SIP
ETMONEY of Economic Times has launched India’s first Aadhaar-based Systematic Investment Plan (SIP). This will enable the individuals to invest in SIPs without making a Demat Account. The payments of SIPs will be initiated using the One Time Password (OTP) received during the transaction to the Aadhar-linked mobile number. ETMONEY intends to reach those sections of the Indian Society that find the SIPs inaccessible. This will also encourage more and more account holders to invest in the mutual funds in the form of SIPs.
Citibank to shut down its retail banking business in 13 countries including India
Citigroup has announced that it will end its retail banking branches under Citibank in India, China, Korea, Indonesia, Bahrain, Australia, Malaysia, Philippines, Poland, Russia, Taiwan, Thailand and Vietnam. Citibank is the largest foreign bank operating in India. Officials of Citigroup said that the company will now focus on its global consumer banking business in the 4 main wealth centers of the world including UAE, London, Hong Kong and Singapore. The company aims to divert its business resources and investments to those sectors where the company is strong.
RBL Bank joins hand with Mastercard for offering first-of-its-kind payment solutions
RBL Bank has partnered with Mastercard for providing 1st of its kind payment solutions to the Indian customers. RBL Bank will roll-out ‘Pay By Bank app’ feature to enable the account holders of RBL Bank to make contactless digital transactions in offline and online stores. The proposed payments solution will be a mobile based consumer friendly feature of the bank. The bank will also make sure that the credentials of the individuals making transactions will be unexposed. This will also benefit the merchants in receiving payments in a contactless mode.
RBI sets Regulations Review Authority 2.0 for reviewing the regulations
Reserve Bank of India (RBI) has established the Regulations Review Authority 2.0 for reviewing the regulatory prescriptions internally. RRA 2.0 will also seek suggestions from the entities regulated by RBI for easy implementation and simplification of the regulations. Deputy Governor, M. Rajeshwar Rao will be leading the authority. RRA 2.0 will be functional for a period of 1 year starting from 1st May, 2021. RRA was formed for the first time in 1999. RRA 2.0 aims to streamline the regulatory instructions and reduce the burden of the regulated entities related to compliance.
Axis Bank rolls-out International Fund Transfer feature in its mobile banking app
Axis Bank has rolled-out the International Fund Transfer feature in the Axis Mobile Banking Application. The feature has been named as ‘Send Money Abroad’ which will enable the users to carry out transactions across 150 countries in 100 currencies. The users will be allowed to send only USD $ 25,000 per transaction. The funds will be transferred to the global banks through the Society for Worldwide Interbank Financial Telecommunications (SWIFT).
IRDAI extends the Regulatory Sandbox Regulations for 2 years
Insurance Regulatory and Development Authority of India (IRDAI) has extended he Regulatory Sandbox Regulations for 2 years under the IRDAI (Regulatory Sandbox) (Amendment) Regulations, 2021. The extension of the time period will enable new sandbox proposals and will also enable the existing applicants to complete their sandbox experiments. The Regulatory Sandbox is a framework established by a regulator that enables the FinTech startups and innovators to perform live experiments in a controlled environment under a regulator’s supervision.
|14th April, 2021|
IRDAI amends the Insurer’s FoF Investments in Alternatives Investment Funds
Insurance Regulatory and Development Authority of India (IRDAI) has made amendments to the rules for the local insurers to make investments in the Fund of Funds (FoF) in Alternative Investment Funds (AIFs). As per the amendment, no investments will be permitted into the AIFs that undertake borrowings other than to meet day-to-day operational requirements. A certificate issued by the Concurrent Auditor will also be required on quarterly basis on the compliance of the conditions.
SEBI slaps Yes Bank with a penalty of INR 25 crores
Securities and Exchange Board of India (SEBI) has imposed a penalty of INR 25 crores on Yes Bank for misleading and practicing fraudulent acts on customers using its ‘Super FD’ Scheme. Yes Bank has been accused for misseling of Additional Tier 1 (AT-1) bonds of the lender’s between 1st December, 2016 and 29th February, 2020. SEBI has also imposed a fine of INR 1crores on The Head of Private Wealth Management Team, Vivek Kanwar and a fine of INR 50 lakh each on Jasjit Singh Banga and Ashish Nasa.
|12th April, 2021|
RBI revises Quarterly Projection Model
Reserve Bank of India (RBI) has revised the Quarterly Projection Model (QPM) which is India’s inflation forecasting model. The improvements will capture the interactions between elements of real-economy with the fiscal and monetary policies of the government. The latest version of QPM has been named as QPM 2.0. Fiscal monetary dynamics, disaggregated fuel pricing, balance of payments and exchange rate interactions have been included in QPM 2.0. It consists of 3 main blocks namely the fuel, balance of payments and fiscal block.
|9th April, 2021|
SBI Mutual Fund’s AAUM crosses the INR 5 lakh crore mark
SBI Mutual Fund (MF) under State Bank of India Funds Management Private Limited has recently announced that its asset base has crossed INR 5 lakh crores. The SBI MF’s Average Asset Under Management increased from INR 3.73 lakh crores to INR 5.04 lakh crores with 1 financial year. SBI MF recorded a growth of 35 % for become the 1st Mutual Fund to achieve this feat. The AAUM grew due to increase in Systematic Investment Plans (SIPs) over the year.
|8th April, 2021|
NPCI and SBI jointly launch UPI awareness campaign for YONO users
National Payments Corporation of India (NPCI) and State Bank of India (SBI) have jointly launched awareness campaign for Unified Payments Interface (UPI) for the users of You Only Need One (YONO) application launched by SBI. This will deepen the reach of UPI transactions across all sections of Indian society. The campaign will also attract new customers to the YONO app of SBI. YONO recorded over 5 million transactions worth INR 2086 crores in the last Financial Year.
|7th April, 2021|
Bharti AXA Life and Fincare Small Finance Bank form Bancassurance
Bharti AXA Life Insurance has entered in a bancassuarnce agreement with Fincare Small Finance Bank (SFB) Limited. Under the partnership the Fincare SFB will sell the insurance schemes of Bharti AXA to its customers across all of its branches in India. Fincare currently holds 26.5 lakh customers who will be presented with a set of comprehensive financial protection products from Bharti AXA Life Insurance. Fincare Small Finance Bank is headquartered at Bengaluru and Rajeev Yadav is the MD and CEO of the SFB.
RBI increases the Temporary Liquidity Limit for States and UTs by 46 %
Reserve Bank of India has increased the Temporary Liquidity Limit of the States and Union Territories by around 46 %. RBI’s move will help the government of States and UTs in managing their respective mismatches in cash flows. The Temporary Liquidity Ratio has been raised from INR 32,225 crores to INR 47,010 crores under the Ways and Means Advances (WMA) mechanism. RBI is further planning to extend the interim WMA limit of INR 51,560 crores till 30th September, 2021.
RBI extends money transfer facilities of NEFT and RTGS to Non-Bank Payment System Operators
Reserve Bank of India (RBI) has extended the money transfer facilities of National Electronic Fund Transfer (NEFT) and Real Time Gross Settlement (RTGS) to the Non-Bank Payment System Operators. These operators will now be a member of the Centralized Payment Systems (CPSs). RTGS allows real-time settlement of the fund transfers whereas NEFT is a centralized payment system that enables transfer of funds from one bank account to another.
RBI extends Public Sector Lending to the NBFCs for another 6 months
Reserve Bank of India (RBI) has extended the Public Sector Lending to the Non-Banking Financial Companies (NBFCs) for the next 6 months i.e., till 30th September, 2021. Earlier RBI allowed only the banking institutions to carry out PSL. But in order to deliver much needed credits to the borrowers, RBI allowed NBFCs except the Mutual Fund Institutions (MFIs) to carry out PSLs to the borrowers related to MSMEs, Agriculture and Housing in 2019. A total of INR 37,000 crores have been provided by the banks to the NBFCs for lending credits to the Priority Sector borrowers.
RBI raises the upper limit of balance in payments bank accounts
Reserve Bank of India (RBI) has raised the upper limit of balance in payments bank accounts from INR 1 lakh to INR 2 lakh. Due to the previous limit the Payments Banks had to tie up with a partner bank for transferring the excess money after INR 1 lakh at the end of the day to the sweep-in sweep-out deposits. A payments bank account can serve as a savings and as a current account. This move of RBI justifies its objective of enabling the Payments banks to cater to the needs of its depositors.
RBI increases loan limit under Priority Sector Lending against NWRs from INR 50 lakh to INR 75 lakhs
Reserve Bank of India (RBI) has increased the loan limit per borrower against hypothecation/ pledge of agricultural produce backed by Negotiable Warehouse Receipts (NWRs) from INR 50 lakhs to INR 75 lakhs. The NWRs are issued by the warehouses registered and regulated by Warehousing Development and Regulatory Authority (WDRA). This will ensure greater flow of credit to the farmers helping them pay off their debts and cost of production.
|6th April, 2021|
RBI lifts the restrictions from Youth Cooperative Development Bank Ltd
Reserve Bank of India (RBI) has lifted the restrictions imposed on the Kolhapur-based Youth Cooperative Development Bank Limited. The bank was put under several restrictions in January, 2019 due to the gradually worsening position of the bank in financial terms. The bank was allowed to carry out unrestricted business of banking from 5th April, 2021. During the restricted period, the bank was not allowed to grant or renew any kind of loans and advances without prior application in written from RBI.
|3rd April, 2021|
Ministry of Finance extends the validity of ECLGS by another 3 months
Finance Ministry has extended the validity of Employees Credit Line Guarantee Scheme (ECLGS) till June, 2021 or until Rs. 3 lakh crores of Target Credit Line is sanctioned under the scheme. Ministry of Finance has also launched ECLGS 3.0 with a wider range covering Travel & Tourism, Hospitality, and Leisure & Sporting Sector. The last date of disbursement has been extended till 30th September, 2021. Under the ECLGS 3.0, the tenure of loans will be 6 years including 2 years of moratorium.
|1st April, 2021|
RBI tightens the security norms for online payment processing companies
Reserve Bank of India (RBI) has tightened the supervision norms for the digital payment processing companies storing customer data following the increase in cybersecurity breaches in Indian Tech startups in the last few months. As per the new norms, all the licensed payment system operators (PSOs) will have to submit their Compliance Certificates to RBI twice in a financial year. The Compliance Certificates will now be duly signed by the CEOs or MDs confirming strict adherence to the rules and regulations of RBI.
PayPal launches Cryptocurrency Checkout Service in USA
American digital payments giant, PayPal has launched Cryptocurrency Checkout Service in USA to enable its users to make payments using their holdings of cryptocurrencies like bitcoin, etherium, litecoin etc. This move of PayPal will significantly boost the use of digital assets for making day-to-day purchases. The users of PayPal have to transfer their bitcoin or ether cash to their PayPal digital wallets to convert them into real money. PayPal intends to launch the same feature for its 29 million merchants in near future.
PhonePe becomes the 1st app to cross 1 billion UPI transactions
PhonePe has become the 1st digital payments platform in India to cross the milestone of 1 billion Unified Payments Interface (UPI) transactions. PhonePe clocked 1.3 billion UPI transactions in March, 2021. PhonePe achieved market leadership in December, 2020 and has been growing steadily after becoming the 1st choice of the merchants. Overall UPI transactions processed by PhonePe has grown from 902.03 million in December 2020 to 975.53 million in February, 2021. PhonePe has been constantly focusing on ramping up its merchant acceptance.
Finance Ministry mandates HSN code on the invoices of the businesses with a turnover of Rs. 5 crores
Ministry of Finance has mandated the businesses with a turnover of Rs. 5 crores and above to mention the 6-digit Harmonized System of Nomenclature (HSN) code in the invoices issued for the supplies of goods and services which are taxable. HSN was introduced by World Customs Organization in 1988. HSN codes are used to classify the goods and services at national and international level. The use of HSN codes has been mandated from 1st April, 2021.
NPCI operationalizes its fully owned subsidiary called ‘NBBL’
National Payments Corporation of India (NPCI) has operationalized its fully-owned subsidiary ‘NPCI Bharat BillPay Limited’ (NBBL) from 1st April, 2021. NPCI has transferred the transaction mandates of Bharat Bill Payment System (BBPS) to NBBL. NPCI consider the establishment of a new entity as a strategic move in coherence with the growth of Bharat BillPay. It offers a range of recurring payment services to customers such as gas, electricity, DTH, water, FASTag etc. NPCI has asked the banks and payment aggregators on the automated billing platform to begin the accounting of their billing transactions under NBBL from 1st April, 2021.
Central Government infuses Rs. 14,500 among 4 banks
Government of India has infused Rs. 14,500 in among Central Bank of India, UCO Bank, India Overseas Bank and Bank of India through the recapitalization bonds. These 4 banks are currently under the Corrective Action Framework of Reserve Bank of India (RBI) for improving their financial prospects. The Government has infused Rs. 4800 crores in Central Bank of India, Rs. 4100 crores in Indian Overseas Bank, Rs. 3000 crores in Bank of India and Rs. 2600 crores in UCO Bank. The recapitalization bonds will be issued by RBI with 6 different maturities.