Banking Awareness of 19 and 20 November 2021

Topic: RBI

1. RBI releases report of the Working Group on Digital Lending.

• RBI has released a report of the Working Group on Digital Lending and invited public comments by December 31, 2021.
• Jayant Kumar Dash, Executive Director, RBI chaired the Working Group. It was set up by RBI on January 13, 2021.
• The report says about 1,100 lending apps are available for Indian Android users from January 1 to February 28. Out of them, more than 600 are illegal loan apps.
• The report notes that RBI’s Sachet portal has been receiving increasing number of complaints against digital lending apps.
• Recommendations of the report of the Working Group on Digital Lending including lending through Online Platforms and Mobile Apps:
  • The Working Group report suggested separate legislation against illegal digital lending activities as well as a verification process for these lenders and a self-regulatory organisation.
  • The report suggests bringing digital lending apps under a verification process by a nodal agency to be set up in consultation with stakeholders. Nodal agency will also maintain a public register of the verified apps on its website.
  • The report recommends the setting up of a Self-Regulatory Organisation (SRO) covering the participants in the digital lending ecosystem.
  • The report also recommends governing unsolicited commercial communications for digital loans by a Code of Conduct to be framed by proposed Self-Regulatory Organisation (SRO).
  • The SRO will also maintain a ‘negative list’ of Lending Service Providers and frame standardized code of conduct in consultation with RBI.
  • As per the report, all data is to be stored in servers located in India and data collection will be with the prior and explicit consent of borrowers with verifiable audit trails.

Topic: RBI

2. RBL Bank authorized by RBI to collect direct taxes.

• Reserve Bank of India has authorized RBL Bank to collect direct taxes on behalf of the Central Board of Direct Taxes.
• RBL Bank’s corporate and individual customers will be able to pay direct taxes through RBL Bank’s mobile banking or net banking platforms.
• The customers will also be able to pay direct taxes through the branch network of RBL Bank.
• RBL Bank is a Mumbai based Indian private sector bank. It was earlier known as Ratnakar Bank. Vishwavir Ahuja is its MD & CEO.

Topic: Banking System 

3. Karnataka Vikas Grameena (KVG) Bank declared Best Regional Rural Bank.

• Karnataka Vikas Grameena (KVG) Bank has been declared as Best Regional Rural Bank (RRB) under ‘Regional Rural Banks Category’ by ASSOCHAM, Mumbai.
• The bank has been declared as Best RRB in recognition of its initiatives in Digital Financial Services.
• R. Gurumurthy, RBI regional director, presented the award to KVG Bank chairman P. Gopi Krishna.
• KVG Bank chairman P. Gopi Krishna said that more than 40 villages had been converted into 100% digital villages by the bank.  In August 2021, KVG Bank had launched FRUITS portal.

Topic: Indian Economy/Financial Market

4. PMEAC expects India to grow between 7-7.5% in the next fiscal year.

• Prime Minister’s Economic Advisory Council (PMEAC) expects India to grow between 7-7.5% in the next fiscal year.
• The economy is expected to grow at 10.5% in current fiscal year after a record contraction of 7.3% last year.
• The first meeting of PMEAC after the recent addition of new members was recently held. 
• PMEAC Member and former RBI Deputy Governor Rakesh Mohan said that India needs to initiate third generation economic reforms to elevate growth to 8-9 % levels.
• Chief Economic Advisor to the Finance Ministry Krishnamurthy Subramanian said that reforms in the judicial side and in overall government capacity to deliver public goods can each add 1-1.5 percentage points to India’s GDP growth.
• He was speaking at the Confederation of Indian Industry (CII) Global Economic Policy Summit 2021.
• Dr. Bibek Debroy is the current chairman of PMEAC. Rakesh Mohan, Poonam Gupta, T.T. Ram Mohan, Sajid Chenoy, Neelkanth Mishra and Nilesh Shah are members of PMEAC.

Topic: MoUs/Agreements

5. NPCI International Payments and Network International sign MoU.

• NPCI International Payments and Network International have signed MoU to discuss their collaboration on acceptance of UPI in United Arab Emirates.
• The collaboration will be beneficial for Indian travelers visiting UAE by allowing them to make payments through UPI-based mobile applications using Network International’s payment infrastructure as UAE’s largest merchant acquirer.
• The rollout of UPI mobile payment solutions on Network International’s merchant network in the UAE will start in the first quarter of 2022.
• Network International is a leading enabler of digital commerce across the Middle East and Africa. Network International has earlier announced the acceptance of RuPay. 
• NPCI International Payments Ltd (NIPL) is the international arm of the National Payments Corporation of India.
• In September 2021, RBI and Monetary Authority of Singapore had announced a project to link their respective fast payment systems (UPI and PayNow).

Topic: Corporates/Companies

6. Supreme Court orders CBI to register a case into alleged irregularities in disinvestment of government’s controlling share in HZL.

• Supreme Court has ordered CBI to register a case into alleged irregularities in disinvestment of the government’s controlling share in Hindustan Zinc Limited (HZL) in 2002.
• However, the apex court has permitted disinvestment of the Centre's residuary 29.5 % share.  
• The court ordered that CBI should register a regular case and the agency shall file its periodic status report to the court.
• Supreme Court was hearing a plea against government’s move to sell residual stake in the company and seeking probe into the divestment in 2002.
• Hindustan Zinc Limited was earlier a Central Sector Pubic Enterprise. It is now owned by Vedanta group companies.

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