Banking Awareness of 8, 9 and 10 May 2024

Topic: Corporates/Companies

1. Over 1.85 lakh companies were incorporated in India in 2023–2024.

• As per the March information bulletin from the corporate affairs ministry, 1,85,312 companies were registered during FY 2023-24, with a total paid up capital of Rs 30,927.40 crore.
• The data shows that in 2022–2023, there were 1,59,524 companies registered with a total paid up capital of Rs 18,132.16 crore.
• In March of this year, around 16,600 firms were set up. By the end of March 2024, there were 26,63,016 companies operating in India.
• Sixty-four percent of them, or 16,91,495 companies, were active. There were 9,31,644 closed registered companies.
• There were 10,385 companies under liquidation and 2,470 defunct entities.
• 27,022 companies in all were in the process of being struck off from official records.
• 71% of the companies that were registered in FY2023–24 were in the services sector.
• Six percent worked in the agriculture sector, while twenty-three percent were in the industrial sector.
• In the service sector, community, personal, and social services saw the biggest increase of 11% when compared to FY 2022–2023.
• Among the states, Maharashtra accounted for 17.6% of newly established companies in 2023–2024.
• There were 5,164 foreign companies registered in India as of March 31, 2024. 3,288 of them, or 64% of the total, were active.
• 33% of the directors registered in India in March 2024 were women, and 67% of the directors overall were men.
• Among the newly registered directors, 43 per cent belong to the age group of 31-45 years and 7 per cent were older than 60 years.

Topic: Reports and Indices

2. India’s retail market will cross $2.2 trillion by 2030, according to a report.

• According to the report by Accel, Fireside Ventures and Redseer Strategy Consultants, about 90% of sales are expected to occur offline.
• The report is titled ‘The Decoding Omnichannel: Strategies for D2C Brands’.
• As per the report, the purchases will be influenced by what will be seen by consumers online.
• As per the report, Indians carried out approximately 24 billion online searches to know more about a product before purchase.
• The report includes frameworks and learnings from digital-first brands.

Topic: RBI

3. New rules for project finance has been proposed by RBI.

• These rules aim to minimize risks associated with long-gestation infrastructure projects.
• Higher provisioning during construction phases is included in these regulations.
• These regulations also include classification of delayed projects as non-performing assets.
• The rules include provisioning of up to 5% during the construction phase, even in case of standard asset.
• A standard assets is the one which does not carry more than normal risk attached to the business.
• RBI aims to increase standard asset provisioning to 1-5% of loans from the current 0.4% in a phased manner.
• The bank has to keep aside 5% of the loan exposure during the construction phase. This becomes lower as the project becomes operational.
• When the project reaches operational phase, the provision can lowered down to 2.5% of the funded outstanding.
• It can be further reduced to 1% if some conditions are fulfilled.  These conditions include following.
  • The project with a positive net operating cash flow that is enough to cover current repayment obligation to all lenders.
  • The total long-term debt of the project with the lenders declined by minimum 20% from the outstanding at the time of achieving Date of Commencement of Commercial Operations (DCCO).
• As per the norms, the banks shall classify a loan as non-performing in case of delay of the project beyond six months of the original deadline or date of commencement of commercial operations.
• RBI has also proposed minimum exposure of banks in consortium lending.
• For projects financed under consortium arrangements and having aggregate exposure borrowing of up to Rs 1,500 crore, each lender is required to have a minimum exposure of 10%.
• For aggregate exposure of over Rs 1,500 crore, individual exposure should not be less than 5% or Rs 150 crore, whichever is higher.
• Additionally, the RBI proposed that the repayment tenor—original or revised—along with any applicable moratorium period should not be more than 85% of the project's economic life.

Topic: Banking System

4. IDBI Bank has received a GST demand order of ₹2.97 crore.

• The bank received this demand order along with interest and penalty for alleged excess availment of input tax credit (ITC).
• The order has been issued by Dehradoon state tax department under the GST rules.
• The order pertains to 2018-19 fiscal for alleged excess availment and utilisation of ITC.
• The order includes a tax demand of ₹1.42 crore.
• The order includes interest and penalty of ₹1.41 crore and ₹0.14 crore, respectively.
• IDBI Bank:
  • It is owned by Life Insurance Corporation of India and Government of India. It was set up in 1964.
  • It is headquartered in Mumbai. M. R. Kumar is its Chairman. Rakesh Sharma is its MD & CEO.

Topic: Agriculture

5. India has permitted non-Basmati white rice export to Mauritius.

• Exports of 14,000 tons of non-basmati white rice to Mauritius have been allowed by the central government.
• Government had prohibited the export of non-Basmati white rice in July 2023 to check domestic prices.
• The Directorate General of Foreign Trade said that the exports of rice to Mauritius are permitted through National Cooperative Exports Limited.
• One of the main importers of non-basmati rice from India is the West African nation of Benin.
• Rice that is partially boiled with husks is called parboiled rice.

Topic: Indian Economy/Financial Market

6. Household savings declined by more than Rs 9 lakh crore in three years to Rs 14.16 lakh crore in 2022-23.

• According to the latest National Accounts Statistics 2024 of the Ministry of Statistics and Program Implementation, net household savings declined sharply from Rs 9 lakh crore to Rs 14.16 lakh crore in the three years to 2022-23.
• In 2020-21, Net household savings reached Rs 23.29 lakh crore. Data shows that they have been declining since then.
• In 2021-22, Net household savings declined to Rs 17.12 lakh crore and a five-year low of Rs 14.16 lakh crore in 2022-23.
• Earlier, the lowest net household savings was Rs 13.05 lakh crore in 2017-18, which increased to Rs 14.92 lakh crore in 2018-19 and Rs 15.49 lakh crore in 2019-20.
• According to data, investment in mutual funds almost tripled in three years to Rs 1.79 lakh crore in 2022-23 from Rs 64,084 crore in 2020-21. In 2021-22, it was Rs 1.6 lakh crore.
• In shares and debentures, the domestic investment almost doubled from Rs 1.07 lakh crore in the three years from 2020 to 21 to Rs 2.06 lakh crore in 2022-23. In 2021-22, it was Rs 2.14 lakh crore.
• In addition, Bank advances (loans) to households have also doubled in three years to Rs 11.88 lakh crore in 2022-23, from Rs 6.05 lakh crore in 2020-21. In 2021-22, it was Rs 7.69 lakh crore.
• Financial corporations and non-banking financial corporations’ loans to households increased also fourfold to Rs 3.33 lakh crore in 2022-23 from Rs 93,723 crore in 2020-21. In 2021-22, it was 1.92 lakh crore.

Topic: Infrastructure and Energy

7. Global energy think tank Ember released a new report stating that in 2023, India surpassed Japan as the world's third-largest producer of solar power.

• According to the report, India's solar energy deployment in 2015 ranked in ninth place.
• In 2023, solar energy generated a record 5.5% of the world's electricity.
• According to Ember's "Global Electricity Review", 5.8% of India's electricity was produced from solar power in the previous year.
• For the nineteenth year in a row, solar energy has been the fastest-growing electricity source in the world.
• In 2023, it generated more than twice as much new electricity globally as coal.
• In terms of global solar generation growth in 2023, India ranked fourth (+18 terawatt hour, or TWh).
• India lagged behind the China (+156 TWh), the United States (+33 TWh) and Brazil (+22 TWh).
• Seventy-five percent of the growth in 2023 came from the top four solar-growth countries combined.
• According to Ember, the world's solar generation increased by more than six times between 2015 and 2023.
• India's share of solar energy in the country's electrical output grew from 0.5% in 2015 to 5.8% in 2023.
• The production of electricity is responsible for almost half of India's yearly carbon dioxide emissions.
• During the COP28 climate change summit in December of last year, world leaders came to a historic agreement to treble the capacity of renewable energy globally by 2030.

Topic: Corporates/Companies

8. Setu unveiled India's first domain-specific LLM for the BFSI sector.

• Sesame, India’s first Large Language Model (LLM) specifically designed for the banking, financial services, and insurance (BFSI) sectors, has been launched by Setu.
• It has been developed in collaboration with indigenous AI research firm Sarvam AI.
• It has been released at an event organised by a non-profit organisation, People+A.
• Setu’s vision is to empower BFSI customers to make smarter, faster credit decisions and provide hyper-personalised financial services to their customers.
• Setu was founded in 2018 by Sahil Kini and Nikhil Kumar. It is an application programming interface (API) infrastructure provider.
• Setu has received a license to operate as an account aggregator from the Reserve Bank of India.

Topic: Reports and Indices

9. Mumbai and Delhi listed among the top 50 richest cities in the world.

• Mumbai with the 24th position and Delhi with the 37th position made it into the top 50 world's wealthiest cities in 2024.
• The latest rankings of the world's wealthiest cities have been released by Henley & Partners and New World Health.
• New York is in the top spot among the top 50 wealthiest cities in the world.
• Among the top 50, 11 cities are from the USA. London (5th) and Los Angeles (6th) have witnessed declines or modest growth compared to a decade ago.
• Five out of the top 10 wealthiest cities are from the Asia-Pacific region. Tokyo (3rd), Singapore (4th), and Beijing (10th) are in the top 10.
• Beijing has made it into the Top 10 for the first time. A 90% surge in millionaires number occurred in the last ten years.
• Singapore is also one of the world’s top destinations for migrating millionaires.
• Seven of the ten fastest-growing millionaire cities are located in the Asia-Pacific (APAC) region.

Topic: Indian Economy/Financial Market

10. India became the first country to get $100 billion in remittances.

• According to the United Nations migration agency, India received $111 billion in remittances in 2022.
• India, Mexico, China, the Philippines, and France were the top five countries to receive remittances in 2022.
• India led in remittance receipts in 2010 ($53.48 billion), 2015 ($68.91 billion), and 2020 ($83.15 billion), with $111.22 billion in 2022.
• Pakistan and Bangladesh are also ranked among the top ten recipients of international remittances.
• The Gulf States remain favourite destinations for migrant workers, particularly from India, Egypt, Bangladesh, Ethiopia, and Kenya
• Globally, India has the largest number of international migrants.
• India also attracted immigrants, ranking 13th globally as a destination country for international migrants.
• The remittance of China has declined due to demographic shifts and its zero-COVID policy.

Topic: Miscellaneous

11. Department of Consumer Affairs issued a warning against drip pricing.

• The central government has issued a warning against the drip pricing.
• The department also shared a sample of how drip pricing applies to customers.
• National Consumer Helpline urged people to connect for any assistance if they face any such situations.
• What is ‘drip pricing’?
  • Drip pricing is a strategy where only a portion of an item's cost is initially displayed.
  • Under this, the full amount is revealed later during the purchase process.
  • The charges often include local taxes or booking charges.
  • It is a technique used by companies to increase the price of an item after the customer has been drawn into the buying process.

Topic: Miscellaneous

12. A new Rs 100 note depicting Indian territories will be issued by Nepal.

• Recently, the printing of a new Rs 100 note announced by Nepal, which has a map that includes the Indian territories of Lipulekh, Limpiyadhura, and Kalapani. India has opposed this move.
• In a meeting chaired by Nepali Prime Minister Pushpakamal Dahal Prachanda, the Council of Ministers decided to include the disputed areas in the new map of Nepal.
• The decision was taken following Nepal Rastra Bank's proposal to update the map on Rs 100 banknotes.
• During meetings held on April 25 and May 2, the redesign, with the updated map, was approved.
• Nepal Rastra Bank has been authorized by the government to replace the current map on currency notes with the updated version.

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