1. PayPal to stop its domestic payment services in India.
- PayPal will stop payment operations and domestic payment services within India from 01 April 2021.
- However, the company will continue its cross-border payment services and allow global consumers to pay Indian merchants using its services.
- PayPal said that it would now focus on allowing international sales for businesses in India.
- PayPal was providing payment options on many Indian online apps such as MakeMy Trip, BookMyShow and Swiggy.
- PayPal is an American company with headquarters in California. Braintree and Venmo are its subsidiaries.
Topic: Banking System
2. Banks have plans to contact Finance Ministry to get sovereign guarantee for the proposed bad bank.
- Banks have plans to contact Finance Ministry to get a sovereign guarantee for the proposed bad bank.
- In Union Budget 2021-22, Finance Minister has proposed Asset Reconstruction Company (ARC) Limited and Asset Management Company (AMC) would be set up for dealing with stressed assets of banks.
- AMC and ARC proposed in Budget 2021-22 will take over the stressed debt of banks and sell the assets to Alternate Investment Funds and other potential investors.
- Two banking industry executives said that sovereign guarantee of security receipts issued by bad bank would allow lenders to directly transfer loans to bad bank without making additional provisions.
- As per the experts, banks should be incentivized for selling stressed assets through the 15:85 model in which they get 15% as an upfront cash payment and the remaining 85% as security receipts to be guaranteed by government.
- Earlier, the financial services secretary has said that government will not provide equity in the bad bank proposed in Union Budget 2021-22. He said that it would be managed by commercial banks on their own.
- Financial services secretary said that bad loan accounts of over ₹500 crore would be eligible to be transferred to the proposed entity.
- Financial services secretary further said that minimum capital of ₹100 crore should be adequate for the bad bank. He also said that the initial capital for bad bank had not been assessed yet.
- As per the latest information, banks have ₹2.25 trillion of bad assets or unresolved stressed assets.
3. IRDAI Working Group recommends Index-Linked Insurance Products (ILIP).
- IRDAI Working Group has recommended setting up of Index-Linked Insurance Products (ILIP).
- In Index-Linked Insurance Products (ILIP), returns are connected with benchmark indices.
- In its report, the working group said that ILIPs could be an option to current conventional guaranteed products and Unit Linked Insurance Product (ULIP).
- IRDAI formed a Working Group on Index-Linked Products in August 2020 to examine the need for Index-Linked Products in India.
- The IRDAI Working Group consisting of six members, had given its report in December 2020. Now, IRDAI has invited public feedback on the report by March 2021.
- In Unit Linked Insurance Product (ULIP), saving benefits are directly related to market value of underlying investments of life insurance policy. They are non-guaranteed, except for pension.
Topic: Banking/Financial Schemes
4. Federal Bank starts FedFirst, a special savings account scheme for children under 18 years.
- Federal Bank has started FedFirst, a special savings account scheme for children under the age of 18 years.
- Under this scheme, FedFirst account holder will get a FedFirst contactless Debit Card. It will have a daily cash withdrawal limit of ₹2,500 and POS/e-com limit of ₹10,000.
- FedFirst account holders will also get several other benefits such as reward points, seasonal cashback and promotional offers.
- Online facilities such as access to internet banking, mobile alerts and e-mail alerts will be available free for FedFirst account holders.
- Federal Bank is an Indian private sector bank with headquarters in Aluva, Kochi. Its CEO is Shyam Srinivasan. Its tagline is your perfect banking partner.
Topic: Infrastructure and Energy
5. India’s first geothermal power project will be established in Ladakh.
- Scientists have identified the Puga village of Ladakh as the hotspot of geothermal energy in India. Puga has a potential of more than 100 MW of geothermal energies.
- The first geothermal power project of India, Geothermal Field Development Project, will be established in Puga village, Ladakh.
- Under the first phase of the pilot project, 1 MW power will be generated, and for this, a tripartite MoU has been signed between ONGC Energy, LAHDC, Leh and the Power Department of UT Ladakh.
- The project is likely to be commissioned by the end of 2022. Research and Development stage or demo of the project will be the second phase of the project.
- Under the third phase, joint ventures and commercial projects will be promoted.
- Geothermal energy is the heat derived within the sub-surface of the earth. It can be used for heating, cooling and generating clean electricity.
- Geothermal fields of India are categorized into five classes, viz. North- western Himalaya, Son-Narmada-Tapti (So-Na-Ta) Lineament, West Coast Margin, Thermal field of eastern and northeast region and other geothermal regions.