New RBI guidelines on urban cooperative banks explained

By Trisha Shreyashi Primary Cooperative Banks, popularly known as Urban Cooperative Banks (UCBs) are cooperative societies registered under provisions of the respective State Cooperative Societies Act or Multi-state Cooperative Societies Act, 2002. UCBs are supervised under the Registrar of Cooperative Societies. However, the power to issue banking licenses and regulate, supervise and develop banking functions of UCBs are vested with the RBI by virtue of the Banking Regulation (BR) Act, 1949.  In light of the BR Amendment Act of 2020, the new fundraising norm was proposed and public comments on the draft were invited by RBI last year in 2021. The 2020 amendment substituted Section 12 to...

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H2FY22 lending boost: Loan growth rises to over 6% in February

The rate of growth in non-food credit on a year-to-date (YTD) basis rose to 6.14% in February as banks benefited from better loan offtake during the second half of the year, typically a busy season for lenders. Through much of FY22, YTD loan growth has been muted, remaining in the negative territory through the first six months, with a blip seen in December, when it jumped to 6.5%. As on February 25, the value of outstanding bank loans stood at Rs 115.59 trillion, up 8.03% year-on-year (y-o-y), according to data released by the Reserve Bank of...

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H2FY22 lending boost: Loan growth rises to over 6% in February

The rate of growth in non-food credit on a year-to-date (YTD) basis rose to 6.14% in February as banks benefited from better loan offtake during the second half of the year, typically a busy season for lenders. Through much of FY22, YTD loan growth has been muted, remaining in the negative territory through the first six months, with a blip seen in December, when it jumped to 6.5%. As on February 25, the value of outstanding bank loans stood at Rs 115.59 trillion, up 8.03% year-on-year (y-o-y), according to data released by the Reserve Bank of...

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Digital credit card will be a precursor to other DIY products: Parag Rao, head – payments business and IT, HDFC Bank

HDFC Bank is going to spread out its fresh digital launches over the next few quarters, now that the regulatory embargo on them has been lifted, Parag Rao, head – payments business and IT, at the bank, told Shritama Bose. Some parts of the payments ecosystem are not yet ready to go live with Aadhaar OTP-based on-boarding for UPI. A launch will be ideal only when 90-95% of the system is prepared, Rao added. Edited excerpts: When will you launch the fully digital challenger bank?Right now we are working on an on-the-fly mobile-only credit card, which will also be serviced completely on the phone and will involve no physical touch. This should be a precursor to many such zero-touch mobile-ready...

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PayPal enables customers to send money to Ukrainians

Fintech company says it will waive fees on transfers of funds to and from Ukrainian accounts until June 30 from The HinduBusinessLine - Money & Banking https://ift.tt/NolMA...

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Bank privatisation to be kickstarted soon

Inter-ministerial consultations have been completed on a draft cabinet note on the proposed amendments. "We have incorporated the relevant suggestions and a final proposal will soon be put for final consideration and approval of the cabinet," the official said. from Banking/Finance-Industry-Economic Times https://ift.tt/u1d9E...

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RBI March bulletin: Transition to green energy may affect banks’ NPAs

The transition to a net-zero carbon emission target could have implications for incomes of industries that indirectly use fossil fuels, and consequently their interest coverage ratio (ICR). This, in turn, could affect gross non-performing asset (NPA) ratios of banks with exposure to such industries, the Reserve Bank of India (RBI) said in a report contained in its March 2022 bulletin. “Therefore, the gross non-performing assets (GNPA) ratio of such industries may be sensitive to green energy transition, and their impact on the overall banking system needs to be monitored closely,” the report said. Almost all the sectors in the economy are indirectly exposed to fossil fuel by virtue of using...

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NPCI nearing pilot launch of wallet-based UPI payments

The National Payments Corporation of India (NPCI) is nearly ready for a pilot launch of wallet-based Unified Payments Interface (UPI) payments. Named UPI Lite, the on-device wallet service will be in line with the Reserve Bank of India’s (RBI) framework for offline digital payments. It will enable transactions of up to Rs 200 at a time with wallet balances capped at Rs 2,000. In a circular dated March 16, NPCI told UPI member banks that UPI Lite shall be launched as a pilot with multiple banks and app providers. After a due level of comfort, a full-scale commercial launch with compliance timelines for on-boarding for the issuers and app providers shall be declared. FE has seen a copy of the...

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CSB Bank advances likely to grow by 20-25% next fiscal

CSB Bank estimates its advances to grow by 20-25% in the next fiscal, with demand seen to be good from the SME and retail sectors. In the current fiscal, the Thrissur-based lender said it will grow only in single digits because of premature closures and takeover of loans by competitors. CVR Rajendran, managing director & chief executive officer of CSB Bank, told FE growth was elusive in FY22 because of the prevailing circumstances and cautious approach. “Not much growth has happened in the current year as SME and wholesale banking were stagnant. Retail loans have not shown growth. Because of excess liquidity in the market, there is cheaper competition. In wholesale banking, there were a...

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India to study sanctions impact on trade settlement with Russia

Russia invaded Ukraine on February 24 in the biggest attack on a European state since World War II, prompting a barrage of sanctions that have limited Russia's ability to do business in major currencies and hit several of its banks and state-owned enterprises. from Business News: Latest News on Business, Stock Markets, Financial News, India Business & World Business News https://ift.tt/w9nxK...

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Yes Bank Scam: HC directs special CBI court to defer framing of charges until April 1

In March 2020, the CBI had registered an FIR against Kapoor, the former Managing Director of Yes Bank Limited, and twelve others including Kapil Wadhawan and Dheeraj Wadhawan of DHFL on the allegation that Kapoor and his family had obtained undue benefit to the tune of Rs. 600 crores through their companies for an investment of Rs. 3700 crores made by Yes Bank in DHFL’s non-convertible debentures. from Banking/Finance-Industry-Economic Times https://ift.tt/vRPYc...

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Fewer EMI bounces point to drop in loan defaults

Debit bounce rates on bank accounts hit their lowest level since May 2019, indicating an improvement in the asset quality of banks. from Business News: Latest News on Business, Stock Markets, Financial News, India Business & World Business News https://ift.tt/YkDC9...

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Banks Board Bureau recommends Alok Choudhary for SBI MD post

The Banks Board Bureau (BBB) on Wednesday recommended State Bank of India (SBI) deputy managing director Alok Kumar Choudhary for the position of managing director at the bank. The bureau has also proposed names of candidates for the position of chief executive at three other public sector banks (PSBs). “After interfacing with 21 candidates on March 5-6; March 11-12 & March 15-16, 2022, the Bureau recommends Shri Alok Kumar Choudhary for the position of MD in SBI and Shri Vinay M. Tonse as candidate on reserve list,” BBB said in a tweet. Tonse is MD & CEO of SBI Mutual Fund. The BBB recommended Canara Bank executive director A Manimekhalai for the post of MD & CEO at Union Bank of...

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Bank CEOs now think they are running technology companies: Bill Winters, CEO, Standard Chartered

"We know what customers want is convenience. And they want it in the platform they are already using very actively - media platform, messaging platform, payment platform, to the extent that they want to acquire some additional financial services. Somebody is going to make it easy for them to do that," said Bill Winters, CEO, Standard Chartered. from Banking/Finance-Industry-Economic Times https://ift.tt/Pe5fD...

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Reliance Capital CEO Dhananjay Tiwari resigns

The debt-laden company promoted by Anil Ambani is undergoing a corporate insolvency resolution process (CIRP) at the Mumbai Bench of the National Company Law Tribunal (NCLT). The Reserve Bank had on November 29, 2021 superseded the board of Reliance Capital Ltd in view of payment defaults and serious governance issues. from Banking/Finance-Industry-Economic Times https://ift.tt/iWxwu...

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HDFC Bank’s post-embargo plans: All-in-one payments app, digital credit cards, DIY solution for merchants

A refurbished payments app, digital credit cards and a fully interoperable merchant solution will be among HDFC Bank’s priority launches over the next two-three quarters, Parag Rao, head – payments business and IT, at the bank, told FE. The Reserve Bank of India (RBI) lifted its penal embargo on digital launches by the bank on Saturday. “Over the next two-three quarters we would be talking about five-six areas where we’d be going to the market with either an upgraded digital offering or a completely new offering. We’ll space them out to give time for us to get everything right and also for customers to absorb them,” Rao said. HDFC Bank will refurbish its PayZapp app and launch it as a complete...

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Securitised pool collection remains stable on limited impact of Covid curbs

The monthly collection ratio of securitised pool remained stable due to the limited impact of restrictions imposed by local administration and digitalisation of payment collections by companies, according to rating agency Crisil. Collection efficiency in securitisation transactions rated by Crisil ratings showed the collections by mortgage-backed securities pools, vehicle pools, two-wheeler pools, and SME pools remained above 96% in February. “The restrictions imposed to combat the pandemic’s spread in the third wave have been comparatively less intense than those in earlier waves. Additionally, many efforts have been made by several financing entities to digitalise their collection processes....

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PNB classifies Rs 2,060 crore to IL&FS Tamil Nadu Power as fraud

Punjab National Bank (PNB) on Tuesday said that it has classified its Rs 2,060.14 crore exposure to IL&FS Tamil Nadu Power as a fraud account. The lender has made provisions worth Rs 824.06 crore against its exposure to the company. “A fraud of Rs 2,060.14 crore is being reported by bank to RBI (Reserve Bank of India) in the accounts of the company. Bank has already made provisions amounting to `824.06 crore, as per prescribed prudential norms,” PNB said in a notification to the exchanges. Last month, Punjab & Sind Bank had also classified the same account as fraud. Its exposure to IL&FS Tamil Nadu Power is Rs 148 crore. IL&FS Tamil Nadu Power is a special purpose vehicle (SPV)...

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Govt to cut bank recap outlay for FY22 by 70%

The government may not need to capitalise any state-run lender this fiscal, other than Punjab & Sind Bank, and will likely save 10,400 crore from the 15,000 crore that was earmarked for this purpose in the revised estimate (RE) for FY22, a top source told FE. This could be the government’s lowest capital infusion into banks in 12 years. Last month, Punjab & Sind Bank obtained its board approval to raise equity capital worth 4,600 crore by issuing preference shares to the government, which will enable it to shore up its capital adequacy....

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Lenders lend a helping hand to firms battling disruptions

While these discussions are at a very nascent stage, banks are seeking to pre-empt working capital disruptions for companies in the export and commodity businesses and those exposed to the oil and gas segment to prevent defaults. from Banking/Finance-Industry-Economic Times https://ift.tt/NFTZH...

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Govt to cut bank recap outlay for FY22 by 70%

The government may not need to capitalise any state-run lender this fiscal, other than Punjab & Sind Bank, and will likely save 10,400 crore from the 15,000 crore that was earmarked for this purpose in the revised estimate (RE) for FY22, a top source told FE. This could be the government’s lowest capital infusion into banks in 12 years. Last month, Punjab & Sind Bank obtained its board approval to raise equity capital worth 4,600 crore by issuing preference shares to the government, which will enable it to shore up its capital adequacy....

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RBI drops pricing caps on micro loans: Change in definition of microfinance

The Reserve Bank of India (RBI) on Monday released a revised framework for microfinance loans, putting an end to regulated interest rates in the segment and harmonising micro-lending norms across banks and non-bank lenders. The regulator also standardised the definition of microfinance loans, stating that all collateral-free loans, irrespective of end use and mode of application, processing and disbursal, provided to households with an annual income up to Rs 3 lakh shall be considered as microfinance loans. The latest framework is based on a consultation paper released by the RBI in June 2021. Microfinance lenders shall now have to put in place a board-approved policy regarding pricing of loans...

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ICRA expects NBFCs’ retail AUM to grow 8-10% in FY23

Retail assets under management (AUM) of non-banking finance companies (NBFC) are expected to grow 8-10% in the next financial year and 5-7% in FY22, ratings agency ICRA said on Monday. However, the wholesale AUM of NBFCs is likely to shrink in FY22 and stabilise in FY23. Disruptions caused in the first quarter of the current financial year are weighing on the overall growth, the rating agency said. However, the AUM and disbursement trend is likely to remain stable in Q4FY22 owing to the limited impact of the third wave of the pandemic on the lending business.  “Within the NBFC-retail segment, personal credit, microfinance and gold loans are likely to be the primary growth drivers as other...

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ICRA expects NBFCs’ retail AUM to grow 8-10% in FY23

Retail assets under management (AUM) of non-banking finance companies (NBFC) are expected to grow 8-10% in the next financial year and 5-7% in FY22, ratings agency ICRA said on Monday. However, the wholesale AUM of NBFCs is likely to shrink in FY22 and stabilise in FY23. Disruptions caused in the first quarter of the current financial year are weighing on the overall growth, the rating agency said. However, the AUM and disbursement trend is likely to remain stable in Q4FY22 owing to the limited impact of the third wave of the pandemic on the lending business.  “Within the NBFC-retail segment, personal credit, microfinance and gold loans are likely to be the primary growth drivers as other...

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Deloitte approaches 43 entities to seek bids for Reliance Capital

The list also includes other asset reconstruction companies, banks, insurers, non-bank finance companies as well as financial technology firms, the people said. The insolvency proceedings were initiated after the Reserve Bank of India superseded the company's board on November 30 last year, citing governance concerns. from Banking/Finance-Industry-Economic Times https://ift.tt/fNkAx...

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'RBI letter to Paytm Bank does not talk about data access'

The Reserve Bank of India (RBI) in its letter to Paytm Payments Bank has not mentioned anything about data access but has asked the company to carry out an audit from a third party, a top official of the company said on Monday. from Business News: Latest News on Business, Stock Markets, Financial News, India Business & World Business News https://ift.tt/aXANy...

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RBI letter to Paytm Bank does not talk about data access, says Vijay Shekhar Sharma

Vijay Shekhar Sharma, the chairman of digital financial services firm One97 Communications and the promoter of Paytm Payments Bank (PPBL), told PTI that the bank is a completely Indian owned controlled entity and has built its own system based on technology "made in India". from Banking/Finance-Industry-Economic Times https://ift.tt/ZP8qs...

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Can India really overthrow Visa and Mastercard?

The decision by global card firms to boycott Russia over its invasion of Ukraine may amplify nationalist sentiments. But will RuPay ever become a serious alternative? It may take more than patriotism to take on the entrenched payment institutions. from Banking/Finance-Industry-Economic Times https://ift.tt/ab5mW...

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'Foreign' pvt banks need govt nod to back debt recast firm

from Business News: Latest News on Business, Stock Markets, Financial News, India Business & World Business News https://ift.tt/KW9Nc...

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Govt has time till May 12 to launch LIC IPO without seeking fresh Sebi approval

On February 13, the government filed the DRHP for the LIC IPO with Sebi, which granted its approval last week. from The HinduBusinessLine - Money & Banking https://ift.tt/pslr5...

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RattanIndia Enterprises looks to tie up with all banks by March 2023 for fintech platform

RattanIndia Enterprises, which recently made a foray into the fintech business, looks to have tie-ups with all the banks by the end of the next financial year. The fintech platform of the company, BankSe, has an arrangement with 21 banks and financial firms to offer loan products, at present. “Plan is to cover all the banks by the end of next financial year. So we will have all the banks offering their products on the platform,” RattanIndia Enterprises chairperson Rajiv Rattan told PTI. The two-wheeler and personal loans get approved in about two minutes, he said, more products would be onboarded going forward because the idea is to make it a full market place for all financial products. Besides,...

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RattanIndia Enterprises looks to tie up with all banks by March 2023 for fintech platform

BankSe is an all-digital financial aggregator platform. from The HinduBusinessLine - Money & Banking https://ift.tt/vGeyd...

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RattanIndia Enterprises looks to tie up with all banks by March 2023 for fintech platform

"Plan is to cover all the banks by the end of next financial year. So we will have all the banks offering their products on the platform," RattanIndia Enterprises chairperson Rajiv Rattan told PTI. from Banking/Finance-Industry-Economic Times https://ift.tt/vOotW...

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Taking immediate steps to comply with RBI directives: Paytm

Paytm Payments Bank to appoint “reputed external auditor” to conduct comprehensive systems audit of its IT systems from The HinduBusinessLine - Money & Banking https://ift.tt/Za0x2...

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Srei Group Companies receive EoIs from as many as 17 entities

from The HinduBusinessLine - Money & Banking https://ift.tt/1H6qt...

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ICICI Bank, Punjab & Sind to pick up stakes in bad bank NARCL

ICICI Bank and Punjab & Sind Bank have signed agreements to pick up stakes in National Asset Reconstruction Company (NARCL). While ICICI Bank will be investing Rs 137.5 crore to acquire a 5% stake, Punjab & Sind Bank will put in Rs 55 crore for a 2% stake. ICICI Bank plans to complete the first tranche of equity investment worth Rs 70.45 crore by March 31. Similarly, Punjab & Sind Bank will invest Rs 28.18 crore in the first tranche, which it expects to complete by March 31. Incorporated on July 7, 2021, NARCL has a total authorised share capital of Rs 2,750 crore. NARCL has been set up by banks to aggregate and consolidate stressed assets with an exposure of over Rs 500 crore for...

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Ban lifted on digital launches of HDFC Bank

HDFC Bank on Saturday said the Reserve Bank of India (RBI) has lifted its embargo on new digital launches by the lender. In August 2021, the regulator had revoked a ban on fresh issuance of credit cards by HDFC Bank. The two measures were regulatory penalties imposed in December 2020 for repeated instances of outages on the bank’s digital channels. “We would like to inform one and all that the Reserve Bank of India has lifted the restriction on the business generating activities planned under the Bank’s Digital 2.0 programme, vide its letter dated March 11, 2022,” HDFC Bank said on Saturday. FE had reported earlier this week that HDFC Bank is working on a plan to build a challenger digital bank...

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