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FINANCIAL AFFAIR
CURRENT DEVELOPMENT IN BANKING

Brief About Reserve Bank of India

➢ Established on April 1st 1935 Under RBI Act 1934

➢ Central office initially established in Calcutta but was moved to
Mumbai 1937
➢ Nationalization in 1949
➢ Fully owned by Government of India (GOI)
➢ 27 regional offices and 4 sub office

Main Function of RBI

1. Implementation of monitory policy to maintain price stability

2. Regulator and supervisor of the financial system to protect
depositor’s interest
3. Manager of foreign exchange under FEMA Act 1999
4. Issue of currency and coins not fit for circulation
5. Development rule to support national objectives
6. Regulator and supervisor of payment and settlement system

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Announcement in Union Budged 2020

➢ President by Smt. Nirmala Sitaraman

➢ Deposit insurance increase from 1 Lac to 5 Lac by Deposit
Insurance and Credit Guarantee Corporation (DICGC)
➢ Corporation bank will be strengthened by amending Banking
Regulation Act
➢ NBFCs to be eligible for debt recovery under securitization and
reconstruction of financial assets and enforcement of security
interest (SARFAESI) in reduced from 500 Croce to 100 Croce or
loan size from 1 Croce to 50 Lac

Financial Market

➢ Certain specified category of Government security to be open by

for nonresident investor also
➢ FPI Limited is increase to 15% from 9%

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Mega Bank Merge

➢ 10 big public sector bank merge into four (2019)

➢ Bank to be merged

Anchor Bank Amalgamating Bank PSB Rank by Size

Punjab National bank Oriental Bank of 2nd Largest
Commerce

United Bank of India

Canara Bank Syndicate bank 4th Largest

(15.20 Lac Crore Business and 10324 Branches)

Union Bank of India Andhra Bank 5th Largest

Corporation Bank
(14.59 Lac Crore Business with 9609 Branches)
Indian Bank Allahabad Bank 7th Largest
(8.80 Lac Crore Business)

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Banking of Unregulated Deposit Scheme Act, 2019

➢ The Act provides for a mechanism to bend unregulated deposit

Scheme and protect the interest of depositors
➢ It amend three law respectively
a. RBI Act 1934
b. SEBI Act 1992
c. Multi-state co-operation societies Act 2002

State Bank of India (SBI) Revised Service Charges w. e. f.

October 1st 2019

➢ Average monthly balances has reduced from 5000 to 3000

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➢ Amount fall to 50% (i.e. 1500) ; Rs. 10 charges plus GST
➢ Fall 75% : fine Rs.15 plus GST
➢ Semi urban area : Rs. 2000 fine 7.5 plus GST in fall of to 50%
and fine plus GST in fall of to 75% fall above 75 : Rs. 12 plus
GST
➢ Rural area : Rs. 1000
➢ Fall up to 50% : Rs. 5 plus GST
➢ Fall up to 75% : Rs. 7.50 plus GST
➢ Fall above 75% : Rs. 10 plus GST

National Electronic Fund Transfer (NEFT) and Real Time Gross

Settlement (RTGS) Through Digital Means Free

➢ NEFT up to Rs. 10000 : Rs. 2 plus GST

➢ Above Rs. 2 Lac : Rs. 20 plus GST
➢ RTGS between Rs. 2 Lac to Rs. 5 Lac : Rs 20 plus GST
➢ RTGS above Rs. 5 Lac : Rs. 40 plus GST
➢ Cash deposit in saving account three transaction in a month and
Rs. 50 plus GST after three transaction
➢ Maximum deposit non home branch is Rs. 2 Lac per day
➢ Account holder with an average monthly balance of Rs. 25000 can
perform free cash withdrawals twice a month
➢ Average monthly balance to Rs. 25000 to RS. 50000 can avail 10
free cash withdrawals
➢ Transaction average limit Rs. 50 plus GST
➢ For above Rs. 50000 to Rs. 1 Lac – charges Rs. 15 plus GST
➢ For above Rs. 1 Lac – Unlimited transaction

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RBI Restricts PMC Bank’s Operation

➢ RBI put Punjab and Maharashtra co-operative Bank under

direction for 6 month.
➢ Depositor allowed to withdraw a sum not exceeding Rs. 1000

ICICI Bank to Open 450 new branches

➢ New 450 branches in FY (Financial year)2020

➢ Cross 5000 branches across the country
➢ 5000th branch was set up at Thane in Maharashtra

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CURRENT DEVELOPMENT IN FINANCE/STOCK MARKET

➢ Disinvestment in LIC by way of IPO( Initial public offer )

➢ Investment by Foreign Government in priority sectors like
infrastructure before 31st March,2024 (lock- in 3 year) will get
100% Tax exemption to the interest, dividend and capital gains
➢ Abolition of dividend Distribution tax( DDT)and Concessional
Corporate Tax has been brought down to 22% ( lowest in the
world)
➢ Effective tax rate shall be 25.17% inclusive of surcharge
➢ Companies shall not require to pay maximum to alternate tax
➢ Investment under make in India initiative shall liable to pay
income tax @ 50% (effective rate 17.01%)
➢ Buy back announced before 5th July 2019 is exempted from tax
➢ Government expand the scope of CSR 2% now CRS fund can be
spend on incubators funded by central or state government, IIT’s
national laboratories and autonomous bodies .

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Important Notes

➢ India post payment bank has launched Aadhar enable payment

system service (AEPS)
➢ NIRVIK (Niryat Rim Vikash Yojna) launched by export credit
guarantee corporation to easy landing of loan to exporter
➢ Airtel Payment Bank has launched Bharosa Saving Account which
provide personal accident insurance up to Rs. 5 Lac event with
maximum balance of Rs. 500
➢ President of Asian Development Bank Takehiko Nakao has
announced registration from January 16th 2020
➢ Ishaat Hussain will head the community constituted by SEBI to
created social stock exchange
➢ Yezdi Hirji Mategam head the expert community recommended by
RBI to revise concurrent audit system
➢ Small exporter can avail the loan of Rs. 40 Crore (New Limited
Sanctioned by RBI
➢ Shyam Srinivasan was appointed as MD & CEO of Federal Bank

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