Banking Awareness of 18, 19 and 20 June 2023

Topic: Banking/Financial Schemes

1. Indian Overseas Bank (IOB) launched ‘My Account My Name’ scheme.

• The scheme was virtually launched by the bank’s MD and CEO from its central office in Chennai.
• The scheme will be available at IOB’s all 49 regional offices in India.
• The scheme is the first of its kind in industry. Under this scheme, customers can choose any name as their savings account number and this can be used for all transactions.
• According to the scheme, the account name can be a combination of seven letters, or seven numbers, or seven alphanumeric only.
• Due to this scheme, customers are not required to remember their 15 digits account numbers.
• In the starting, the scheme is available for IOB SB HNI and IOB SB SALARY account customers.
• Indian Overseas Bank:
  • It is a nationalized bank headquartered in Chennai.
  • It is a government-owned bank. Ajay Srivastava J is its MD and CEO.

Topic: Banking System

2. IndusInd Bank has collaborated with Wise to enable online inward remittance services to NRIs residing in US and Singapore.

• Indus Fast Remit and Wise Platform have entered into partnership to offer multi-currency inward remittance service to NRIs.
• Indus Fast Remit is IndusInd Bank’s own multi-partner remittance service platform.
• Non Resident Indians (NRIs) can book remittance transactions on the Indus Fast Remit and credit to their family.
• This will be in line with the Rupee Drawing Arrangement (RDA) scheme of RBI through Wise’s RDA partners in India.
• IndusInd Bank:
  • It is a Pune-based bank. It was started in 1994 by Srichand P Hinduja.
  • Sumant Kathpalia is its CEO. Its tagline is we make you feel richer.

Topic: RBI

3. RBI carried out a four-day variable rate repo (VRR) auction on 19 June 2023.

• RBI carried out VRR auction to inject liquidity into the banking system.
• Banks’ tried to draw funds aggregating ₹75,695 crore from the RBI at the auction. The notified amount for the auction was ₹75,000 crore.
• They received funds aggregating ₹75,004 crore at the cut-off rate of 6.51%.
• RBI last time carried out VRR auction on May 19. Banks drew funds aggregating ₹46,790 crore from the RBI at the cut-off rate of 6.51%. The notified amount was ₹50,000 crore.
• The liquidity in the market has come down from around ₹1.50-1.60 lakh crore to around ₹85,000 crore on 17 June 2023.
• The liquidity has come down mainly due to advance tax outflows of about ₹1.50-lakh crore.
• RBI’s target is to bring call money rate to 6.50%. RBI will carry out Variable Rate Reverse Repo (VRRR) if call money trades around 6.25%.
• RBI will carry out VRR if call money trades at around 6.75%.

Topic: Banking System

4. UCBs want increase in ceiling on loans against gold and gold jewellery from ₹2 lakh to ₹5 lakh under the bullet payment scheme.

• RBI allowed bullet repayment of gold loans up to ₹1 lakh in 2007.
• This was later increased in 2014 to ₹2 lakhs, with the repayment being limited to 1 year.
• Under Bullet repayment and Equated Monthly Instalment (EMI) repayment routes, urban co-operative banks (UCBs) are permitted to extend gold loans for 12 months.
• In bullet repayment, a borrower pays the principal and interest on a loan in lump sum to a lender at the end of the loan tenure.
• The loans against gold jewellery portfolio of scheduled commercial banks (SCBs) increased by 20.4% year-on-year as on 21 April, 2023.

Topic: Banking System

5. Max Life has acquired a 2.99% stake in Capital Small Finance Bank for ₹49.50 crore.

• With this, Capital Small Finance Bank’s Capital Adequacy Ratio has increased by over 1% to 20.77%.
• Max Life Insurance Company Limited (Max Life) is an Indian life insurance company.
• It is the largest non-bank private-sector life insurer in India.
• Capital Small Finance Bank started operations as India’s 1st Small Finance Bank on April 24, 2016.

Topic: Reports and Indices

6. India’s eB2B market is estimated to reach $90-$100 billion by 2030 according to a report by Redseer Strategy Consultants.

• The report estimates that India’s business-to-business ecommerce (eB2B) market will grow at a compound annual growth rate (CAGR) of 40–45% from $5–6 billion in CY2022 to $90-$100 billion by 2030.
• The Indian retail market is worth $950 billion. However, it is unorganized. The fragmented market puts retailers at a disadvantage.
• As per the report, eB2B platforms provide solutions for these retailers through strategic brand partnerships.
• As per the report, eB2B platforms provide solutions for these retailers by eliminating intermediaries from the retail value chain.
• The report says that there are limited multi-category platforms with pan-India operations across categories like grocery, electronics and accessories, general merchandise, and fashion.

Topic: Reports and Indices

7. According to the ‘Annual Report on Pay & Allowances’, more than 9.64 lakh posts are vacant in government.

• The report has been prepared by the Department of Expenditure of the Finance Ministry.
• As per the report, the number of sanctioned posts and persons in position in the Central government, including Union Territories, has come down.
• As on 1 March 2022, 39.77 lakh was the total sanctioned strength of Central government civilian regular employees. This excludes Union Territories. The strength was 40.35 lakh as on March 1, 2021.  
• The number of persons in the position came down from 30.56 lakh to 30.13 lakh.
• The number of sanctioned posts is the lowest in three years. The number of persons in position is the lowest after 2010.
• Five major Ministries/Departments cover almost 92% of the total manpower.
• They are Railways, Defence (Civil), Home Affairs, Posts, and Revenue.
• Railways provides almost 4 out of 10 Central government civilian jobs.

Topic: Taxation

8. An increase of 12.73% was registered in the gross collection of direct taxes in the financial year 2023-24.

• In the financial year 2023-24, the figures of direct tax collection up to 17 June showed that the net collection has been Rs 3,79,760 crore.
• It was Rs 3,41,568 crore in the same period of the previous financial year i.e. FY 2022-23, which shows an increase of 11.18%.
• Net direct tax collection (up to June 17) of Rs 3,79,760 crore includes Corporation Tax (CIT) of Rs 1,56,949 crore and Personal Income Tax (PIT) of Rs 2,22,196 crore including Securities Transaction Tax (STT).
• The gross collection of direct taxes (before adjustment of refunds) in the financial year 2023-24 stood at Rs 4,19,338 crore as compared to Rs 3,71,982 crore in the corresponding period of the previous financial year.
• This shows an increase of 12.73% over the collection in FY 2022-23.
• The gross collection of Rs 4,19,338 crore includes Corporation Tax (CIT) of Rs 1,87,311 crore and Personal Income Tax (PIT) of Rs 2,31,391 crore including Securities Transaction Tax (STT).
• In the first quarter of the financial year 2023-24, till June 17, the advance tax collection was Rs 1,16,776 crore.
• While the advance tax collection in the same period of the immediately preceding financial year i.e. 2022-23 was Rs 1,02,707 crore, which shows an increase of 13.70%.
• Advance tax collection of Rs 1,16,776 crore till June 17 includes corporation tax (CIT) of Rs 92,784 crore and personal income tax (PIT) of Rs 23,991 crore.
• Refunds worth Rs 39,578 crore have also been issued in FY 2023-24 till June 17, which is 30.13% higher than refunds of Rs 30,414 crore issued during the same period in the previous FY 2022-23.

Topic: World Economy

9. European Central Bank (ECB) has raised borrowing costs (interest rates) to its highest level in 22 years to curb elevated inflation levels.

• The ECB has left the door open for more hikes to fight against inflation, which remains high.
• The ECB raised its key interest rate - the rate one banks pay for safely keeping cash at the central bank - for the eighth time in a row, by 25 basis points to a 22-year high of 3.5%.
• The central bank of the 20 countries that share the euro also said it expects inflation to stay above its 2% target until 2025 and once again hinted at more rate hikes in the coming months.
• The ECB now expects the economy to grow 0.9% this year.
• China has cut two key benchmark lending rates for the first time in 10 months.
• Its one-year loan prime rate has been lowered by 10 basis points to 3.55% and the five-year LPR has been cut by 10 basis points to 4.20 %.
• MSCI's (Morgan Stanley Capital International) broadest index of Asia-Pacific shares outside Japan fell 0.69%.
• European Central Bank (ECB) is the central bank of the European Union (EU) countries which have adopted the euro. Christine Lagarde is its President.

Read Banking Awareness PDF - 18, 19 and 20 June 2023