Banking and Financial Awareness – 74

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23 Nov, 2014

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Financial Inclusion-2

1) According to an announcement made by the Union Finance Ministry on 14 November 2014, which two States and three Union Territories have achieved 100% banking inclusion under the Pradhan Mantri Jan Dhan Yojana (PMJDY) as on 5 November 2014? – Goa and Kerala (states) and Chandigarh, Puducherry and Lakshadweep (Union Territories)

Explanation: 100% banking inclusion means having at least one bank account for every household. According to official data available till 5 November 2014, 11.26 lakh bank accounts were opened in Kerala, followed by 77,485 accounts in Goa, 1.36 lakh accounts in Chandigarh, 69,819 accounts in Puducherry and 3,588 accounts in Lakshadweep under the Pradhan Mantri Jan-Dhan Yojana (PMJDY). States of Kerala and Goa, union territories of Chandigarh, Puducherry and Lakshadweep and three districts of Gujarat — Porbandar, Mehasana, Gandhinagar have been declared as 100% saturated in terms of coverage of all households with at least one bank account.

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2) Kisan Vikas Patra (KVP), one of the most popular small savings scheme in India, was re-launched on 18 November 2014. It was discontinued from November 2011 on the recommendation of the Shyamala Gopinath Committee. When KVP was initially launched? – 1 April 1988

Explanation: The Kisan Vikas Patra was launched initially in 1988 and became one of the most popular small savings instruments ever. However, the Shyamala Gopinath Committee (2011) recommended that it should be discontinued as it was prone to misuse, being a bearer-line instrument. KVP was later discontinued from November 2011. But now Union govt. has relaunched the scheme with an objective of giving a boost to country’s small savings sector.

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3) The Reserve Bank of India (RBI) on 11 November 2014 raised the minimum capital requirement for so-called shadow banks to Rs. 1 crore by March 2016 and Rs. 2 crore by end of March 2017. This was done to avoid any potential risk to the economy from these rapidly growing finance firms by regulating them like traditional banks. What was the minimum capital requirement for these entities till now? – Rs. 25 lakh

Explanation: The RBI also announced that certain investment-grade non-banking firms would be allowed to take deposits and the companies will have until March 2016 to acquire a credit rating. It also capped deposit-taking at 1.5 times the size of a firm’s minimum capital, down from four times previously. Shadow banks, or non-banking financial companies (NBFCs), have in recent years played a bigger role in financing small businesses and individuals in India, taking over from the banks that reined in credit as economic growth slowed. These companies were now so entrenched in the financial system that they needed better regulation.

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4) Which bank would be merged with Kotak Mahindra Bank (KMB) as approved by the Board of Directors of KMB on 20 November 2014? – ING Vysya Bank

Explanation: As per as a notice to the BSE by KMB, the KMB Board approved a share swap ratio of 725 equity shares of Rs. 5 each of KMB for every 1000 equity shares of Rs. 10 each held in IVB. This merger would be first merger since 2010 in private sector banking space when Bank of Rajasthan was acquired by ICICI Bank. ING Vysya Bank was the first bank to come into existence through a merger between an Indian bank and a foreign bank when Dutch banking group ING and Vysya Bank merged in 2002 to form this bank.

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5) The Reserve Bank of India (RBI) on 20 November 2014 asked banks to inform their customers about fall in minimum balance well in advance and said that penal charges should be levied only to the extent of shortfall in such balances. The guidelines pertaining to levying of penal charges for non-maintenance of minimum balance are coming into effect from which date? – 1 April 2015

Explanation: The notification issued by the RBI stated that the penal charges should be directly proportionate to the extent of shortfall observed. Charges should be a fixed percentage levied on the amount of difference between the actual balance maintained and the minimum balance as agreed upon at the time of opening of account. A suitable slab structure for recovery of charges may be finalized for the same.

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6) The Securities and Exchange Board of India (SEBI) on 19 November 2014 approved new rules on insider trading that will replace a two-decade old law. Under the newly approved rule, which new segment of people will be considered insiders, i.e., persons capable of influencing prices of shares through the sensitive information they possess about particular scrip/scrips? – Immediate relatives of senior management, other stakeholders such as founders, and third-party clients handling market sensitive information

Explanation: The rules, which are based on recommendations first revealed late during 2013, broaden the scope of who can be held liable for insider trading violations and require company officials to be more transparent about their trading activities. SEBI has widened the definition of who exactly is an insider by including persons in possession of or with access to unpublished price sensitive information. The definition now states that all persons and their immediate relatives with a contractual, fiduciary or employment relationship with the company will be considered “connected persons”. New insider rules are part of efforts being done by SEBI to boost investor confidence in stock markets.

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7) What is the name of the internet banking facility of Bharatiya Mahila Bank Ltd (BMB) that was launched on 19 November 2014? – ‘BMBSmartBanking’

Explanation: BMB, India’s first women’s bank completed one year of operations on 19 November 2014. On this occasion a newly designed website of the bank was also launched. The ‘BMBSmartBanking’ was launched by Ananthasubramanian, Chairman and Managing Director, BMB. BMB currently has network of 33 branches and all of them have core banking solutions (CBS) with onsite ATMs.

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8) Indian Railways had identified how many areas in its operations to allow 100% foreign/private investment as stated in the new guidelines under the Railway FDI policy that was approved by the Union Govt.? – 17 sectors

Explanation: Broadly, the Railway Ministry is putting up for private participation projects that are expected to be financially remunerative and on which construction work has not started. The Railways has sanctioned projects running into lakhs of crores on which work has not started because of dearth of funds.

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9) The Union Govt. on 10 November 2014 unveiled the draft Civil Aviation Policy. Which two PSU stakeholders in aviation sector are proposed to be corporatised and listed on stock exchanges as listed in this draft? – Airports Authority of India (AAI) and Pawan Hans Helicopters Limited (PHHL)

Explanation: The draft Civil Aviation Policy was unveiled by Union Civil Aviation Minister Ashok Gajapathi Raju. The draft would now be open for wider consultation with all stakeholders and is expected to be implemented by January 2015. It proposes to corporatise AAI and PHHL so as to improve transparency and efficiency of these two PSU entities. An in-house expert committee for suggesting road map of Air India’s revival has also been proposed. The draft also proposes to enhance regional air connectivity, develop six major metro airports as international hubs, create more airports through PPP mode, rationalise jet fuel cost, promote air cargo, MRO and helicopter operations and improve passenger facilitation.

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10) The Union Govt. launched a modified Direct Benefit Transfer of LPG (DBTL) scheme in how many districts on 15 November 2014? – 54

Explanation: Under this modified DBTL scheme, LPG consumers who have not yet availed the benefit will be able to get cash subsidy amount transferred into their accounts to buy Liquefied Petroleum Gas (LPG) cylinders at market price. Every time a domestic LPG consumer books a cylinder the government will transfer Rs. 568 to the customers’ bank account so that the money would be there in the account before gas reaches their homes. Each household is entitled to get 12 subsidized cylinders a year. So those who have already exhausted the quota will not get any subsidy this year. This scheme will be implemented in the rest of India on 1 January 2015. Post implementation of this scheme India’s LPG subsidy burden of Rs 48,000 crore is expected to come down by 15%. The Aadhaar linked DBTL scheme was launched on 1 June 2013 and finally covered 291 districts. The government has comprehensively reviewed the scheme and after examining the difficulties faced by the consumer substantively modified the scheme prior to the launch.

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  1. jaihasini says:

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