Banking Awareness of 9, 10 and 11 June 2022

Topic: Corporates/Companies

1. Guidelines to curb misleading advertisements and unfair trade practices notified.

• Centre has notified the guidelines for Prevention of Misleading Advertisements and Endorsements for Misleading Advertisements, 2022 under the Consumer Protection Act 2019.
• These guidelines also tighten the standards for advertisements that target children, bait ads and free claim ads.
• Ads regarding junk foods and drinks shall not be advertised during a programme meant for children or on a kids’ channel.
• The guidelines prohibit surrogate ads which refers to an advertisement for products or services, whose advertising is otherwise prohibited or restricted by law.
• Now, the brand ambassadors to make disclosure of their material connection with the brand in terms of shareholding or ownership.
• These also specify that a brand shall not provide false description of product or service, give false guarantees, mislead the customers about the quality or quantity of product or conceal information.

Topic: RBI

2. RBI issued new provisioning norms for Urban Cooperative Banks (UCBs).

• RBI has rolled out new provisioning norms for inter-bank exposure of UCBs and valuation of UCB’s perpetual non-cumulative preference shares and equity warrants.
• RBI directed UCBs to continue making provisions of 20% for such exposures.
• The new norms have been issued in the wake of bankruptcy of Punjab & Maharashtra Cooperative (PMC) Bank in September 2019 and merger of PMC with Unity Small Finance Bank w.e.f 25 January 2022.
• These norms are applicable for all UCBs and are in force with immediate effect.
• Urban Cooperative Banks (UCBs):
  • They are primary cooperative banks that may be located in an urban or semi-urban area.
  • They are classified as scheduled and non-scheduled urban cooperative banks
  • Until 1996, they could lend money for non-agricultural reasons only.
  • They are governed by RBI and state governments.

Topic: Regulatory Bodies/ Financial Institutions

3. IBBI issued guidelines for establishment of common panel of Insolvency Professionals.

• The term of the earlier panel ended on 30 June. Therefore, the new guidelines have been issued by Insolvency and Bankruptcy Board of India (IBBI) for setting up the next common panel.
• The common panel comprises of qualified interim resolution professionals (IRP), resolution professionals (RP), or liquidators from which the National Company Law Tribunal (NCLT) selects and make appointments under the IBC Code.
• The aim of these guidelines is to save time in the process of appointment of resolution professional which will further help in speedy resolution of cases.
• Insolvency and Bankruptcy Board of India (IBBI):
  • It was established on 1 October 2016 under Section 188 of the Insolvency and Bankruptcy Code, 2016.
  • It is responsible for the implementation of the IBC code.
  • It is a unique regulator that regulates a profession as well as process.
  • The IBBI conducts its quasi-legislative, executive and quasi-judicial functions simultaneously.
  • Chairperson of IBBI: Ravi Mittal
  • Head office: New Delhi

Topic: Banking System

4. Finance Minister launched EASE 5.0 'Common Reforms Agenda' for PSBs.

• Minister of Finance and Corporate Affairs Nirmala Sitharaman launched EASE 5.0 under the EASENext program. It lists the common reforms agenda for public sector banks.
• Till now, four editions of Enhanced Access and Service Excellence (EASE) have been launched from FY19 to 22. EASE 4.0 was launched in August 2021.
• PSBs will continue to invest in next-generation capabilities and deepen ongoing improvements under EASE 5.0 for changing customer needs, competition, and the technological environment.
• The focus of EASE 5.0 will be on the digital customer experience, as well as integrated and inclusive banking.
• All PSBs will also create a bank-specific three-year strategic roadmap.
• PSB Manthan was conducted in April 2022 with the functional heads of Public Sector Banks, which paved the way to launch the EASENext program.
• EASENext consist of 2 key initiatives: EASE 5.0 (Common PSB Reform Agenda) and Bank Specific Strategic 3-Year Roadmap (based on the business priorities of the individual bank). EASENext reforms will ensure ease for customers as well as employees.

Topic: Agriculture

5. India’s first ventilated cold storage for onion to be established by WayCool.

• WayCool is a Chennai based Startup and one of India’s leading agri-commerce platform.
• It will initially build a pilot plant.
• Onion is current stored in warehouses with ventilation. If it is stored in cold storage and taken out, the bulb of the onion rots very quickly. But, now technology is available to keep it dry.
• WayCool has collaborated with Netherlands’ Mooji Agro to convert cold storage to ventilated cold storage in order to preserve crops like potato, onion, etc.
• The ventilated cold storage reduces sprouting and increases shelf life of the crop.
• Innovation in supply chain will offer benefits to farmers and reduce price volatility.
• Outgrow, farmer advisory platform of WayCool, uses AI for early disease prediction and detection.
• Operation Greens: It was announced by the government during Budget 2018-19. The scheme aims to stablise the supply and price of TOP crops (Tomato, Onion and Potato). The scheme was expanded to cover 22 perishables including shrimp during budget 2021-22.

Topic: Reports and Indices/Ranking

6. India is one of the leading markets for fintech apps in Asia, says a report.

• According to Sensor Tower’s State of Fintech and Crypto Apps 2022 report, the total downloads of global financial, fintech apps have reached a record high of 1.74 billion in first quarter of 2022.
• The growth in fintech app market has increased amid COVID-19 pandemic with downloads of apps crossing 6.1 billion in 2021.
• India and Southeast Asia are the leading markets for fintech apps in Asia.
• There has been an increase in quarterly downloads in North America, Latin America and Europe. The apps downloaded are mainly related with payment, crypto and banking.
• Southeast Asia can be an emerging market for cypto apps as the downloads increased from 6 million in 2020 to 21 million in 2021.
• In Q1 2022, crypto apps accounted for 7% of the downloads of top 50 fintech apps in Southeast Asia.
• Globally, the crypto app market is expanding every year.
• Binance, Crypto.com, Coinbase are the top crypto apps. In Australia, CoinSpot app tops the list of popular crypto apps.
• India’s fintech market is projected to be at $150-160 billion by 2025, as per the Affle’s MAAS report.

Topic: Indian Economy

7. Outward FDI by India has declined in May 2022.

• India’s Outward FDI has reduced significantly in May to 803.32 million dollars amid slowdown in world economy.
• Total financial commitment by way of outward FDI via equity, loan and guarantee issued by Indian companies totaled to $3.39 billion in April 2022 and $3.44 billion in March 2022.
• According to UNCTAD’s World Investment Report, the Russia-Ukraine war, COVID-19 pandemic and climate change have caused food, fuel, and finance crisis particularly in developing countries.
• In the latest RBI’s annual report, higher outward FDI from India during FY22 was towards Singapore, US, UK, Netherlands, Mauritius and Philippines.
• Also, the major sectors that attracted India’s overseas direct investment during FY22 are financial insurance and business services, manufacturing, wholesale and retail trade, and restaurants and hotels.
• Outward direct investment (ODI) is a form of business strategy in which a domestic firm expands operations into a foreign country.

Topic: Regulatory Bodies/ Financial Institutions

8. Life insurers can now launch products without prior approval: IRDAI

• IRDAI has allowed life insurers to launch their products without prior approval of the regulator.
• The life insurers should have a board approved product management and pricing policy.
• The life insurers can now launch variety of products in a timely manner as per the market demand, except for individual savings, individual pensions and annuity.
• All insurers can follow ‘use and file’ procedure as the authorization has already been granted to health and general insurance products.
• This step will promote ease of doing business for insurers and increase choices available to policyholders.
• Insurance Regulatory and Development Authority of India (IRDAI):
  • IRDAI is an autonomous statutory body. It was formed under the Insurance Regulatory and Development Authority Act, 1999.
  • It regulates and promotes both insurances as well as reinsurance industries in India.
  • It has 10 members, including the chairman, 5 full-time and four part-time members. Government of India appoints part-time members of IRDAI.
  • Chairman of IRDAI: Debashish Panda (wef 14 March 2022)
  • Headquarters: Hyderabad, Telangana

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