Banking Awareness of 3, 4 and 5 July 2024

Topic: Banking/Financial/Govt Schemes

1. Interest rate of 7.1% for Special Deposit Scheme (SDS) from July to September was announced by the Finance Ministry.

• 7.1% interest will be earned on deposits made under the SDS for non-government provident, superannuation, and gratuity funds between July 1 and September 30.
• The rates from the April–June quarter have not changed.
• The interest rate on SDS form one important aspect affecting the announcement of the interest rate on the Employee Provident Fund (EPF).
• This is due to the fact that the SDS holds approximately 80% of the EPF corpus.
• Non-government provident funds, such as EPFO, invest in the SDS scheme.
• The SDS of 1975 was created to give provident funds, especially those run by employers in the public and private sectors, a safe and reliable place to invest.
• The SDS is backed by the Government of India. This significantly reduces the investment risk.
• Guaranteed rate of return is one of the main attractions of the scheme.

Topic: MoUs/Agreements

2. Jan Suraksha schemes will be integrated across 43 RRBs by NABARD and Online PSB Loans.

• Online PSB Loans Ltd. and the National Bank for Agricultural and Rural Development (NABARD) have signed a MoU.
• The purpose of the MoU is to streamline the enrollment and claim resolution procedures for each of the 43 Regional Rural Banks (RRBs) under the Jan Suraksha Schemes.
• NABARD will incorporate all 43 RRBs onto the Jan Suraksha Portal as part of this programme.
• This would be done in order to democratise access to financial protection programmes in unreachable parts of the nation, such as Pradhan Mantri Jeevan Jyoti Bima Yojna and Pradhan Mantri Suraksha Bima Yojna.
• The initiative's goal is to use digital technology to streamline Jan Suraksha plan enrollment and settlement.
• This initiative is a significant step towards bridging the financial gap in rural areas.
• This initiative will also ensure more transparency and quicker speed for disbursal to beneficiaries.
• Online PSB Loans is a digital lending platform in India.
• National Bank for Agriculture and Rural Development (NABARD) was founded in July 1982. It is headquartered in Mumbai.
• It is under the jurisdiction of the Ministry of Finance. Shaji K V is its Chairperson.

Topic: Banking System

3. Axis Bank entered into partnership with Piramal Capital and Housing Finance Ltd (PCHFL).

• The partnership is for co-lending in the micro, small and medium enterprises (MSMEs) and home loan segments.
• Under the partnership, loans will be offered to middle- and low-income borrowers with a focus on rural and semi-urban regions.
• The partnership aims to cater to customers in the unorganized sector.
• These include self-employed or salaried borrowers having limited credit access because of insufficient income.
• The partnership will leverage loan processing technology of Piramal Finance and financial expertise of Axis Bank.
• These will be used to assess the credit profile of borrowers and they will be provided loans at competitive interest rates through a network of branches of Piramal Finance.
• The lenders have partnered to address the credit gap faced by MSMEs and home loan borrowers.
• Piramal Capital and Housing Finance Limited was earlier Dewan Housing Finance Corporation Ltd. (DHFL). It is a non-deposit taking housing finance company.
• Axis Bank is the third-largest private sector bank in India that is headquartered in Mumbai. Its MD & CEO is Amitabh Chaudhry.

Topic: Corporates/Companies

4. ‘Health Saathi Plan’ has been launched by Paytm at just ₹35 per month.

• One97 Communications Limited, which owns the Paytm brand, has announced the launch of 'Paytm Health Saathi'.
• It is an exclusive health and income protection plan for its merchant partners. It is available on the 'Paytm for Business' app.
• 'Paytm Health Saathi' aims to protect the well-being of its merchants, and ensure their health and business continuity.
• Paytm Health Saathi provides a range of services, including unlimited doctor teleconsultation and OPD within its partner network.
• It also includes income protection cover in case of business interruption due to accidents or natural calamities such as flood, fire or strike.
• In May, the 'Paytm Health Saathi' pilot scheme was launched and so far, over 3,000 merchant partners have availed the plan.

Topic: Banking System

5. ICICI Bank introduced ‘Student Sapphiro Forex Card’.

• This card is for students going abroad for higher education and is powered by Visa.
• The card allows users to load and transact in up to 15 different currencies without incurring any cross-currency markup fees from the bank.
• Even with just one currency loaded on the card, it enables students to travel the world with ease.
• The Forex Card offers specific incentives in addition to joining benefits up to ₹15,000.
• It comes with a welcome kit that has two cards-- a primary and a replacement card.
• Parents and kids can reload this card online through internet banking and iMobile Pay.
• ICICI Bank is an Indian multinational bank and financial services company.
• It is headquartered in Mumbai. Sandeep Bakhshi is its CEO. It was founded in 1994.

Topic: Reports and Indices

6. India's services sector growth picks up in June.

• India's services sector growth quickened in June due to new orders and an unprecedented expansion in international sales.
• The HSBC India Services Business Activity Index rose from 60.2 in May to 60.5 in June.
• A record expansion in international orders has been reported.
• Australia, Europe, Latin America, the Middle East and the US were all cited as sources of new work from abroad.
• The HSBC India Composite Output Index has recovered from 60.5 in May to 60.9 in June.
• Private sector employment expanded at a sharp pace and was the fastest since 2005.
• The HSBC India Services PMI has been compiled by S&P Global from responses by 400 service sector companies.

Topic: Banking/Financial/Govt Schemes

7. Smart Cities Mission extended till March 2025.

• The Government of India has extended the mission period up to 31 March 2025 to complete the remaining 10% of projects.
• The Mission has been receiving several requests from government representatives of some states/cities to grant some more time to complete the remaining 10% projects.
• Cities have been informed that this extension will not entail any additional cost beyond the financial allocation already approved under the mission.
• Since its inception in June 2015, the Mission has introduced several innovative ideas, such as competition among cities for the selection of 100 smart cities, stakeholder-driven project selection, and the formation of smart city Special Purpose Vehicles for implementation.
• Over 8,000 multi-sector projects are being developed by 100 cities at a cost of about ₹1.6 lakh crore.
• As of 03 July 2024, the 100 cities have completed 7,188 projects (90% of the total projects) amounting to ₹1,44,237 crore as part of the Mission.
• The remaining 830 projects amounting to ₹19,926 crore are also in the final stages of completion.
• In terms of financial progress, the Mission has an allocated Government of India budget of ₹48,000 crore for the 100 cities.
• Till date, the Government of India has released ₹46,585 crore (97% of the Government of India allocated budget) to the 100 cities.
• Of these funds released to the cities, 93% have been utilised so far.
• The Mission has also released the entire Government of India financial assistance under the Mission to 74 out of the 100 cities.

Topic: MoUs/Agreements

8. A $170 million loan signed by India and ADB to enhance pandemic preparedness and response.

• On 2 July, a $170 million policy-based loan signed by Government of India and the Asian Development Bank (ADB) to consolidate and strengthen India’s health system preparedness and response capacity to future pandemics.
• On behalf of the Government of India, Ms. Juhi Mukherjee, Joint Secretary, Department of Economic Affairs, and on behalf of ADB, Ms. Mio Oka, Director, ADB’s India Resident Mission, signed the “Strong and Scalable Actions for Resilient and Transformative Health Systems Program (Sub-program 1)”.
• The ADB program will help the government improve disease surveillance, ensure an adequate and skilled health workforce, and promote climate-resilient public health infrastructure and services.
• A $1.5 bn loan has been approved by the World Bank to support India’s green hydrogen initiatives.
• To help India accelerating its low-carbon energy development, a $1.5-billion loan has been approved by the World Bank.
• The funds will be used to promote a market for green hydrogen, electrolysers, and increased renewable energy penetration.
• World Bank had approved the $1.5-billion First Low-Carbon Energy Programmatic Development Policy Operation in June 2023.

Topic: Miscellaneous

9. Denmark became the first country to impose a tax on livestock farmers.

• Denmark has levied a tax on livestock farmers for the greenhouse gases emitted by their cows, sheep and pigs.
• The tax has been imposed to reduce greenhouse gas emissions by 70% from 1990 levels by 2030.
• As per a report by the UN, livestock are responsible for about 32% of human-caused methane emissions.
• A normal cow can generate up to 200kg of methane annually while a Danish cow produce 6.6 tons of carbon dioxide per year.
• Danish livestock farmers will be taxed 300 kroner ($43) per ton of CO2, which will be increased to 750 kroner ($108) by 2035.
• The tax is part of Denmark’s strategy to meet climate goals. The collected tax amount will be invested in environmental restoration projects.

Topic: Committees/Commissions/Taskforces

10. Government formed a 26-member committee for the revision of the base year.

• The Ministry of Statistics and Programme Implementation (MoSPI) has formed a 26-member committee headed by Biswantah Goldar to revise the base year for national accounts.
• G C Manna, former Director-General of the CSO, Chetan Ghate from the Institute of Economic Growth, and Partha Ray from NIBM, Pune are some prominent members of this committee.
• The current base year for indices like the Wholesale Price Index (WPI), Producer Price Index (PPI), and Consumer Price Index (CPI) is 2011-12.
• The committee will also recommend a new base year for national accounts, which is likely to be 2020-21.
• The main objective of the initiative is to increase the accuracy of economic analysis and policy formulation by reviewing existing databases and incorporating new data sources.
• It will also give recommendations on adopting the latest UN standards and classifications for developing sector-wise accounts.
• This initiative will be step towards modernizing national accounting practices and will foster robust research and policy formulation capabilities.
• The base year acts as a reference point for tracking economic variables.

Read Banking Awareness PDF - 3, 4 and 5 July 2024