Banking Awareness of 26, 27 and 28 June 2022

By Priyanka Chaudhary | Last Modified: 30 Jun 2022 17:06 PM IST
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Topic: RBI

1. RBI has given in principle approval to Mufin Finance for issuance of semi-closed prepaid payment instruments.

  • Mufin Finance is the fourth NBFC to receive such a licence from the RBI.
  • Bajaj Finserve, Manapurram and Paul Merchants are other brands that have received this licence.
  • After receiving a semi-closed PPI licence, digital banks and fintech firms can launch features such as digital payment solutions for lending.
  • Mufin Finance is in the process of launching MufinPay, a digital payment solution that will complement its lending business.
  • Prepaid Payment Instruments (PPI) can be in the form of digital wallets, smart cards, magnetic chips and vouchers.
  • Gift cards, payment wallets, smart cards and vouchers are all forms of PPIs.

Topic: Banking System

2. State Bank of India (SBI) received RBI’s approval to establish operations support subsidiary.

  • SBI has received in-principle approval from RBI for operations support subsidiary aimed at bringing down the cost-to-income ratio.
  • SBI will soon begin a pilot run in selected areas before introducing the new subsidiary across India.
  • SBI’s cost to income ratio stood at 53.3% in FY22. The cost to income ratio of the top three private banks is at 35-40%.
  • The subsidiary would focus on providing support services mainly for agriculture, micro, small and medium enterprises.
  • The subsidiary would also focus on other micro loans, data entry operations, and activities that can be undertaken as allowed for Business Correspondents.

Topic: Banking System

3. UPI 123Pay payment and wearable ATM cards have been launched by fintech services company Acemoney.

  • Acemoney is the first company in India, which has launched UPI 123Pay services in Malayalam and Tamil.
  • RBI launched UPI 123Pay in March 2022.
  • With the help of UPI 123Pay, people can carry out cashless transactions without smartphones or internet connections using feature phones.
  • The wearable ATM cards are designed as key chains and rings. They allow people to do cashless transactions without ATM cards and phones.

Topic: Reports and Indices

4. RBI released ‘Quarterly Basic Statistical Return-1: Outstanding Credit of Scheduled Commercial Banks – March 2022’ report on 27 June 2022.

  • As per the report, year-on-year bank credit growth increased in successive quarters of 2021-222 from 5.1% in March 2021 to double-digits by March 2022.
  • The report says that credit to female borrowers increased by 13.9% during 2021-22. Female borrowers had 22.5% share in bank loans to individuals.
  • Metropolitan branches led the credit growth. They accounted for 54.5% of the incremental credit during 2021-22.
  • The share of personal loans segment in total credit increased to 27.7% in March 2022 from 26.3% in March 2021.
  • The share of lending to the household sector in total credit stood at 53.8% in March 2022.
  • Year on year credit growth in industrial sector increased to 4.8% in March 2022. This was in comparison with 2% in previous quarter and negative growth for eight successive quarters before that.
  • Growth in working capital loans increased to reach 7.1% in March 2022.
  • Credit offtake by private corporate sector recorded 5% year-on-year growth in March 2022.
  • Weighted average lending rate (WALR) on outstanding credit decreased by 42 basis points during 2021-22.

Topic: Reports and Indices

5. ‘India's Booming Gig and Platform Economy’ report has been released by NITI Aayog.

  • According to this report, 77 lakh workers were engaged in the gig economy in 2020-21.
  • Around 2.35 crore (23.5 million) workers by 2029-30 will work in the gig economy.
  • Currently, around 47% of the gig workers are in medium-skilled jobs, 22% in high-skilled and about 31% in low-skilled jobs.
  • Till 2029-30, Gig workers’ share in the non-agricultural workforce will be 6.7%.
  • The report also suggests platform-led transformational and outcome-based skilling and enhancing social inclusion through gender sensitization.
  • This report is a first-of-its-kind study that presents comprehensive perspectives and recommendations on the gig economy in India.
  • It highlights the opportunities and challenges of the gig economy and presents global best practices on initiatives for social security.
  • ‘Gig Economy’ is a free market system, which consists of short-term employment, contractual jobs, and independent contractors.

Topic: Appointments

6. Avinash Kulkarni, CEO of the India Resurgence Asset Reconstruction Company (IRARC), will be the head of IDRCL.

  • He will succeed Manish Makharia and will serve a three-year term.
  • Kulkarni's appointment comes after Natarajan Sundar was appointed CEO of the NARCL in April.
  • He would act as the sole agent for the resolution of more than 83,000 crores in bad loans to be acquired by the government-backed National Asset Reconstruction Company (NARCL).
  • India Debt Resolution Company Limited (IDRCL):
    • It is a private sector asset management company owned by private sector banks with a 51 percent stake.
    • IDRCL was established by the government with an authorized capital of Rs 50 crore.
    • Its seven-member board is headed by former SBI executive Diwakar Gupta.

Topic: Appointments

7. 1986 batch Indian Revenue Service (IRS) officer Nitin Gupta has been appointed as the new chairman of the CBDT.

  • He is serving as the Member (investigation) of the Central Board of Direct Taxes. He is scheduled to retire in September 2023.
  • CBDT member and 1986-batch IRS officer Sangeeta Singh was holding the post of CBDT chairman in an additional capacity after J B Mohapatra retired on April 30.
  • There are five members in the CBDT at present. Other three members are Anuja Sarangi, Pragya Sahay Saksena and Subashree Anantkrishnan.
  • Central Board of Direct Taxes (CBDT):
    • It is the administrative body for the Income Tax department.
    • It is headed by a Chairman. It can have six members who are in the rank of special secretary.

Topic: Companies/Corporates

8. IN-SPACe has authorized Dhruva Space and Digantara to launch payloads.

  • IN-SPACe authorised Dhruva Space Pvt. Ltd., Hyderabad and Digantara research & technologies Pvt. Ltd. Bengaluru, on June 24 to launch their payloads.
  • This marks beginning of private space sector launches in India. Both Dhruva Space and Digantara are space technology start-ups.
  • Dhruva Space's Dhruva Space Satellite Orbital Deployer (DSOD 1U) and Digantara's ROBust Integrating Proton Fluence Meter (ROBI) have been authorized.
  • They would fly onboard PSLV Orbital Experimental Module (POEM) of PSLV-C53 on June 30.
  • Indian Space Promotion and Authorisation Centre (IN-SPACe):
    • It is an autonomous, single window nodal agency.
    • It was formed to promote, authorise, monitor and supervise the space activities of non-governmental private entities in India.

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Banking Awreness Jan to June 2022