Banking, Financial and Economic Awareness of 5 and 6 August 2021

Topic: RBI

1. MPC unanimously decides to keep policy repo rate unchanged at 4%.

• Monetary Policy Committee (MPC) has unanimously decided to keep the policy repo rate unchanged at 4%.
• It has also decided to maintain an accommodative stance as long as necessary to support growth.
• MPC’s bi-monthly meeting was held recently. MPC has kept the repo rate unchanged at 4% since May 2020. In May 2020, the repo rate was cut by 40 basis points from 4.40%.
• RBI Governor Shaktikanta Das, who chairs the MPC, said that MPC met at a time when inflation has remained above RBI’s upper target range of 6% for two consecutive months. Retail inflation was recorded at 6.36% in June.
• Repo rate is the interest rate at which banks borrow from the RBI to overcome short-term liquidity mismatches.

Topic: Indian Economy

2. Finance Ministry adds new definition of start-up in the procurement process for consultancy and other services by government.

• Finance Ministry has added a new definition of the start-up in the procurement process for consultancy and other services by the government.
• The definition of ‘start-up’ was changed by Department for Promotion of Industry and Internal Trade (DPIIT) in February 2019.
• As per the new definition, entity will be considered as a ‘start-up’ up to a period of 10 years from the date of incorporation/registration.
• Additionally, the turnover of the entity for any financial year since incorporation/ registration should not exceed ₹100 crore.
• Entity formed by splitting up of an existing business will not be considered as a ‘start-up’.
• The existence period was earlier 5 years and the turnover limit was ₹25 crore.

Topic: Taxation

3. Finance Minister introduces 'The Taxation Laws (Amendment) Bill, 2021' in the Lok Sabha.

• Finance Minister has introduced 'The Taxation Laws (Amendment) Bill, 2021' in the Lok Sabha.
• The bill has been introduced to repeal retrospective taxation of capital gains from sale of assets located in India by entities registered abroad.
• It proposes amendments in Income-tax Act, 1961 and the Finance Act, 2012.
• It provides that tax demands raised according to the 2012 retrospective amendment for any indirect transfer of Indian assets before May 28, 2012 will be deemed never made.
• Finance Bill, 2012 got the President’s assent on May 28, 2012. Companies will get back the money paid if they withdraw cases against India.
• The bill is a move to settle retrospective tax disputes with companies such as Cairn Energy and Vodafone.

Topic: Appointments

4. Re-appointment of Prakash Chandra as Non-Executive (Part Time) Chairman of RBL Bank approved by RBI.

• Re-appointment of Prakash Chandra as Non-Executive (Part Time) Chairman of RBL Bank has been approved by RBI.
• Chandra’s reappointment has come into effect from August three for a three-year period.
• 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

5. Axis Bank crosses mark of over one million customers on its WhatsApp banking channel.

• Axis Bank has crossed the mark of over one million customers on its WhatsApp banking channel.
• Axis Bank had launched banking services on WhatsApp in January 2021.
• If the customers sign up for the service, they can inquire and get details of products such as savings account, credit and debit cards, deposits and personal loans.
• They can also get access to non-financial services such as locating ATMs or getting updates on third-party deals available on credit and debit cards.

Topic: Banking System

6. ICICI Prudential Life Insurance enters into partnership with NPCI to provide UPI Autopay facility to its customers. 

• ICICI Prudential Life Insurance enters into partnership with the National Payments Corporation of India (NPCI) to provide a Unified Payments Interface (UPI) Autopay facility to its customers. 
• The customers can link their bank accounts with UPI Autopay for payment of premium when they purchase a life insurance policy.
• Customers can activate the UPI Autopay e-mandate by using their smartphones to make regular renewal premium payments.

Topic: Regulatory Bodies/Financial Institutions

7. Carlyle Group-led ₹4,000 crore equity investment transaction in PNB Housing Finance Ltd (PNBHFL) approved by CCI.

• Carlyle Group-led ₹4,000 crore equity investment transaction in PNB Housing Finance Ltd (PNBHFL) has been approved by the Competition Commission of India (CCI).
• CCI observed that the proposed combination raises no risk of any appreciable adverse effect on competition under the competition law.
• Under the deal, Carlyle Group and other investors were to infuse ₹4,000 crore capital into PNBHFL through preferential allotment of equity shares.
• But, the deal faced trouble when SEBI intervened and asked PNBHFL not to go ahead until it undertakes valuation of its shares by an independent agency.
• PNBHFL later appealed before Securities and Appellate Tribunal (SAT), which has reserved its order.

Topic: Appointments

8. Mini Ipe takes over as Managing Director of the LIC.

• Mini Ipe has taken over as Managing Director of the Life Insurance Corporation (LIC).
• She was previously Executive Director of LIC’s Legal Department.
• She had joined LIC in 1986 as a direct recruit officer.

Topic: Banking System

9. DBS Bank honoured as global winner for Most Innovative Bank in Digital Banking by Financial Times publication, The Banker.

• DBS Bank has been honoured as a global winner for Most Innovative Bank in Digital Banking by Financial Times publication The Banker in its 2021 Innovation in Digital Banking Awards.
• In addition, the bank was also named the Asia-Pacific winner. It also won in the Cyber Security category for its Secure Access and Remote Working Solution.
• DBS Bank had last year launched DBS Digital Exchange, NAV Planner and Covid contact-tracing solution using AI/machine learning.
• DBS Digital Exchange is a blockchain-based ecosystem for fundraising through asset tokenisation and secondary trading of digital assets including cryptocurrencies. It was launched in December 2020.
• NAV Planner is a feature-rich digital advisory solution powered by more than 100 artificial intelligence (AI) models.
• Leading financial publication Euromoney has recognized DBS Bank as Asia’s Best Bank and Asia’s Best Digital Bank in its regional Awards for Excellence 2021.
• Euromoney has also recognized DBS as Best Bank and Best Investment Bank in Singapore.

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