Banking Awareness of 16 and 17 September 2022

By PendulumEdu | Last Modified: 17 Sep 2022 19:16 PM IST
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Topic: Awards and Prizes

1. Fintech start-up TRaiCE has won NASSCOM-NIPP GCC award.

  • TRaiCE Inc has won NASSCOM-partnered NIPP GCC Fintech Challenge in the ‘Predictive Analytics for Customer Retention’ category.
  • It has won award for using predictive AI to help lenders improve operational efficiencies for faster, safer financing.
  • NPAs are a constant problem for banks. TRaiCE uses machine-learning-led predictive analytics to help lenders identify problem accounts early.
  • TRaiCE Inc is a no-code AI-augmented early warning and Business Risk Monitoring System. It is a Kochi-based fintech start-up.
  • In the NIPP GCC Fintech Challenge, supported by NASSCOM, start-ups can compete by presenting solutions for actual problems faced by businesses in the banking, insurance, and financial services industries.

Topic: Reports and Indices

2. India’s ranking in global crypto adoption index drops by two places.

  • India’s ranking declined by two places to fourth place among 20 countries with the highest cryptocurrency adoption rate.
  • In 2021, India was ranked at second place in Chainalysis’ Global Crypto Adoption Index.
  • The Vietnam (1st), Philippines (2nd) and Ukraine (3rd) are the top three countries.
  • The United States rose from eighth place in 2021 and sixth place in 2020 to fifth place in the Top 20 Global Crypto Adoption Index for 2022.
  • In actuality, emerging markets made up 18 of the top 20 countries for crypto adoption.
  • The United Kingdom is placed at 18th overall. After finishing thirteenth in the index in 2021, China reentered the top ten this year.
  • India was ranked first in terms of things like the value of cryptocurrencies received from DeFi (decentralised finance) protocols and retail value received at centralised exchanges.
  • Its overall ranking was however affected by a low peer-to-peer (P2P) exchange trade volume score.
  • Chainalysis is an American blockchain analysis firm. It measures the grassroots adoption of cryptocurrency.

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Topic: Banking System

3. Koo partners with India Post Payments Bank (IPPB) to promote financial inclusion in remote cities.

  • Both have signed a MoU, which aims to bring together the synergies of Koo and IPPB to promote 'financial inclusion' and 'literacy' in tier 2, tier 3, and remote cities.
  • Indian microblogging platform Koo said the MoU will help in communicating via Koo’s language communities using Multi-Lingual Koo (MLK) features.
  • Koo is an Indian microblogging and social networking service. It is based in Bengaluru. Aprameya Radhakrishna is its CEO.
  • India Post Payments Bank:
    • It was established by the Department of Posts under the Ministry of Communications.
    • It was founded on 01 September 2018. Its CEO is J. Venkatramu. Its tagline is Aapka Bank, Aapke Dwaar.
    • It is headquartered in New Delhi. It is a division of India Post which is under the ownership of the Department of Post under Ministry of Communications.

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Topic: Banking System

4. State Bank of India reached Rs 5 lakh crore market capitalisation on 14 September 2022.

  • With market capitalisation of Rs 5 lakh crore, SBI stood on the seventh position in the market capitalisation ranking.
  • On 14 September 2022, State Bank of India became seventh Indian company to cross the ₹ 5-trillion market capitalisation on the Indian stock exchanges for the first time.
  • SBI is the third lender in the country to surpass the market capitalisation of Rs 5 lakh crore.
  • HDFC Bank held first rank in this list of lenders crossing market capitalisation of Rs 5 lakh crore. It was followed by ICICI Bank.
  • State Bank of India (SBI):
    • In 2017, State Bank of Bikaner and Jaipur, State Bank of Hyderabad, State Bank of Mysore, State Bank of Patiala and State Bank of Travancore were merged with State Bank of India.
    • Its headquarters is in Mumbai, Maharashtra. Its tagline is The Banker to Every Indian. Dinesh Kumar Khara is its chairperson.

Topic: Indian Economy/Financial Market

5. Finance Ministry has released draft guidelines for Regional Rural Banks (RRBs) to raise resources from capital market.

  • This paves the way for them to raise funds via rights issue, initial public offerings (IPO) and private placement with certain investors like large banks and insurance companies.
  • Under the draft guidelines, before issuing shares through the IPO route, RRBs should issue bonus shares and a Rights Issue in consultation with merchant bankers and the sponsor bank.
  • If the shareholding level of the concerned State Government (SG) in the RRB can be decreased to 15%, the Department of Financial Service may consult the concerned SG.
  • The parameter for selection of RRBs for capital raising are given below.
    • Net worth of at least ₹300 crore in each of the preceding three years
    • Minimum Capital to Risk-weighted Assets Ratio above the regulatory requirement of 9% in each of the preceding three years
    • Track record of profitability - pre-tax operating profit of minimum ₹15 crore for at least three out of previous five years
  • Further, RRBs should have return on equity of minimum 10% in three out of preceding five years.
  • They should have return on assets of minimum 0.5% in three out of preceding five years.
  • Presently, there are 43 RRBs sponsored by 12 Scheduled Commercial Banks.
  • Government of India (GoI), the respective State Governments (SGs), and the Sponsor Banks (SBs) jointly own RRBs, with equity contribution in the ratio (GoI: SG: SB: 50:15:35).

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Topic: Corporates/Companies

6. Ministry of Corporate Affairs has relaxed the paid up capital threshold for small companies.

  • The threshold for paid up capital for small companies would be “not exceeding ₹4 crore”.
  • The turnover threshold would be “not exceeding ₹40 crore”.
  • Earlier, threshold for paid up capital was “not exceeding ₹2 crore” and turnover threshold was “not exceeding ₹40 crore”.
  • This would facilitate Ease of Doing Business and reduced compliance burden for small companies.
  • Those companies whose paid-up capital does not exceed ₹4 crore and turnover does not exceed ₹40 crore, will qualify as small companies.
  • Hence they will avail the benefits available to small companies. Some of the benefits are given next.
    • Filing an abridged annual return
    • No mandatory rotation of auditor
    • No need to report on the adequacy of the internal financial controls and its operating effectiveness in the auditor’s report
    • Holding of only two board meetings in a year
    • Annual returns can be signed by the company secretary or by a director of the company
    • Lesser penalties

Topic: Indian Economy/Financial Market

7. According to estimates of Ind-Ra, India’s current account deficit increased to $28.4 billion (3.4% of GDP) in April-June quarter (1QFY23).

  • This is against a deficit of $13.4 billion (1.5% of GDP) in January-March quarter (4QFY22).
  • As per India Ratings & Research (Ind-Ra), India’s merchandise exports reached a record high level of $121.2 billion in 1QFY23.
  • They are likely to slow down to $104.2 billion in 2QFY23. 
  • As per Ind-Ra, merchandise imports are expected to remain robust due to elevated global commodity prices and weak rupee.
  • The merchandise imports grew 40.5% during July-August 2022 to $128.2 billion. They are expected to reach at $192.2 billion in 2QFY23.
  • The agency highlighted that the volume of telecom instrument exports that increased by four times in the first quarter of FY23 is a positive development.
  • India's wheat exports benefited from the conflict between Russia and Ukraine. In 1QFY23, India's wheat export volume quadrupled.
  • India Ratings & Research (Ind-Ra):
    • It is headquartered in Mumbai. It is a 100% owned subsidiary of the Fitch Group.
    • It is recognised by the Securities and Exchange Board of India and Reserve Bank of India.

Topic: MoUs/Agreements

8. Karnataka had signed MoUs worth ₹1.3-lakh crore in the renewable energy space.

  • Karnataka CM made this announcement while speaking at the inauguration of the fifth edition of the Indian Manufacturing Show (IMS).
  • He said the government is building industrial parks at Gulbarga, Yadgir, and Mysuru.
  • Karnataka aims to be a $1-trillion economy by 2025.  It was the first State in India to offer Production Linked Incentives (PLIs) to the semiconductor and FMCG sectors.
  • India Manufacturing Show 2022 is being organised by Laghu Udyog Bharati-Karnataka IMS Foundation in Bengaluru.

Topic: Taxation

9. Government has lowered windfall tax on diesel exports, Air Turbine Fuel (ATF) exports and domestically produced crude.

  • Ministry of Finance lowered windfall profit tax on diesel export to ₹8.50 per litre and jet fuel exports to ₹5 a litre.
  • Earlier, these taxes were ₹13.5 and ₹9 a litre, respectively.
  • The tax on domestically-produced crude oil has been lowered from ₹13,300 per tonne to ₹10,500 per tonne.
  • New rates have become effective from September 17. India first imposed windfall profit taxes on July 1.

Topic: Corporates/Companies

10. Serious Fraud Investigation Office (SFIO) arrested the "mastermind" behind shell firms with Chinese links.

  • The Ministry of Corporate Affairs conducted simultaneous search and seizure operations on 8 September 2022 at the offices of Jillian Consultants India Private Limited, a wholly owned subsidiary of Jillian Hong Kong Limited, Gurgaon.
  • The Serious Fraud Investigation Office (SFIO) has arrested the mastermind Dortse, a member of the Board of Jillian India Limited.
  • He was the mastermind of the entire racket of getting several shell companies with Chinese links to enter India and providing fake directors on their boards.
  • It was found that Husys Limited was also acting on behalf of Jilian India Limited.
  • Serious Fraud Investigation Office (SFIO):
    • It is India's statutory institution for investigating corporate fraud.
    • Initially, it was established by a resolution adopted by the Government of India on 2 July 2003.
    • SFIO was later accorded statutory status under Section 211 of the Companies Act of 2013.
    • It is under the jurisdiction of the Ministry of Corporate Affairs, the Government of India.
    • Director of SFIO: Keshav Chandra

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