Experts say the new guideline is likely to hurt foreign players more, especially card companies such as Visa, MasterCard and American Express who process and store credit card transaction data outside of India.
The Reserve Bank of India on Thursday allowed Non-Resident Indians to hedge currency risk for external commercial borrowings (ECBs) denominated in rupees with Indian banks.
The focus shall also be on consolidation of public debt and reducing rollover risk through active switch/buyback operations.
The RBI may grant licences for setting up small finance and payment banks by April 2015.
The RBI now brings in important and contentious changes directly through voluminous Master Directions, or Master Circulars
According to the RBI's April 6 circular, cash loading companies, which take cash around the country, are supposed to increase their net worth to Rs 1 billion within 90 days.
The race to get a New Umbrella Entity (NUE) licence for digital payments may get crowded. As many as six consortiums are said to be in the fray to apply for an NUE licence, which would create a for-profit National Payments Corporation of India (NPCI)-like body for retail payments. A consortium led by Financial Software and Systems (FSS), a leading provider of payment products and payment processor, is in talks and may file an application to the RBI for an NUE license, said sources aware of the development. The other constituents of this group include Indian Bank, Central Bank of India, India Post Payments Bank, National Bank for Agriculture and Rural Development (Nabard), and a few small finance banks.
RBI said inflation in the second half of the current fiscal is projected at 2.7-3.2%. It retained its GDP forecast for the current fiscal at 7.4%
An internal working group set up by the RBI has proposed to raise the cap on promoters' stake in private banks from the current 15 per cent to 26 per cent in 15 years. The group has also recommended that large corporate or industrial houses may be allowed as promoters of banks only after amendments to the Banking Regulation Act and strengthening of the supervisory mechanism for conglomerates, including consolidated supervision. The Reserve Bank of India had constituted the internal working group (IWG) on June 12, 2020, to review extant ownership guidelines and corporate structure for Indian private sector banks.
RBI proposed that at least half of the compensation of a CEO should be variable. It also said that stock options should be part of the variable pay, against the extant practice of keeping it beyond and above the scope of the official compensation package.
'The Jalan Committee has now provided very clear guidelines on how the (RBI's) balance sheet should be looked at, what kind of disclosures should be made, what are the principles on which the Contingency Risk Buffer should be maintained, what should be the revaluation reserves, and the market risk to the Contingency Risk Buffer.'
Deposits by NRIs with persons other than authorised dealers or banks, out of inward remittances from overseas or by debit to NRE or FCNR(B) accounts, will not be permitted with immediate effect.
'The RBI has not allowed any commercial bank to fail in the past three decades.' 'It has always played the role of a matchmaker, but this is the best deal it has stitched,' notes Tamal Bandyopadhyay.
ED and Directorate of Revenue Intelligence have detected a significant increase in the outflow of Indian money, specifically into four countries --Thailand, Dubai, Singapore and Hong Kong.
Members of Parliament, state legislatures, and local governments not eligible to be members of PSB boards
RBI had on February 12, 2018 issued a circular saying that lenders have to provide for resolution plan within 180 days in case of large account of Rs 2,000 crore and above.
RBI has cited at least 10 areas where it has no control over PSBs.
'Prevention is better than cure' seems to be the focal point of the latest action points of the Reserve Bank of India (RBI) in the Annual Conference of Banking Ombudsman. So, the apex bank is looking at setting a template of good customer service that will prevent consumer grievance.
Freebies being doled out by the Madhya Pradesh and Rajasthan governments ahead of the assembly polls Friday came under scrutiny by the Supreme Court which sought responses from the two states, the Centre and the Election Commission on a PIL alleging misuse of public money.
Though it's debatable whether power to supersede bank boards can adequately safeguard against the problems created by banks promoted by those with interests in other industries, the finance ministry has at least shed its reluctance to bulldoze the Reserve Bank of India.
For the convenience of people to pay school fees and municipal taxes and utility bills through an integrated platform, the Reserve Bank on Thursday proposed setting up an "anytime anywhere" bill payment system.
'Real estate loans are given in the garb of retail loans, sourcing money cheap from the NHB refinance window.' 'This loophole is being plugged,' notes Tamal Bandyopadhyay.
The Reserve Bank of India (RBI) kept its key policy repo rate unchanged at 8.0 percent on Tuesday, as widely expected, while expressing concerns about risks to its target to bring consumer inflation down to 6 percent by January 2016.
Discussion paper fixes Rs 1,000 cr as minimum capital for these specialised banks
The RBI also allowed banks to levy ATM charges beyond 5 transactions for the same bank's account holders.
Observing that MSME sector plays an important role in the growth of the Indian economy, RBI said the restructuring of the borrower account has been extended by further one year to March 31, 2021.
Central Bank of India's 21.5 per cent assets are either bad or have been restructured.
Reserve Bank has almost finalised the structure of Central Fraud Registry.
'When I met the prime minister on November 15 there was no RBI report with the prime minister as to why this was done.' 'When I asked the PMO officer about this, he said the RBI did not bring this to the PM and did it independently.' 'When I asked how could the RBI ban DCCBs from accepting deposits from farmers in old notes when the government gazette released on November 9 allowed them to do so, this officer told me that not even senior PMO officials had any idea about this RBI ban.'
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Amidst debate over control of Jet Airways post UAE's Etihad buying stake, the RBI on Thursday notified FDI guidelines defining control of a company, saying that a firm will be said to be controlled by non-residents if they have powers to appoint majority of the directors.
The Reserve Bank will consider reducing the number of free ATM withdrawals, as recommended by Indian Banks' Association, in an effort to cut down on cash transactions in the economy.
Seed and early-stage start-ups are high-risk businesses, rarely have collateral and only 1 in 10 of them makes it to becoming a viable company.
The PCA plan covers various suggestions or measures to recover non-performing assets (NPAs), reduce costs, boost capital, downsize risk-weighted assets, and improve profitability, among others. The LVB management is in the process of implementing all of these, said sources.
With the July 1 deadline to apply for bank licence fast approaching, aspirants are scrambling to meet the Reserve Bank of India's (RBI) eligibility criteria to apply.
The RBI on Friday imposed a fine of Rs 6.5 crore (Rs 65 million) on six public sector banks including IDBI Bank, Dena Bank and Indian Bank, for violation of customer identification or KYC norms and anti-money laundering guidelines.
The RBI came out with new bank licence guidelines last month wherein it said the important criterion for processing application would be business model of the applicants and it should provide for financial inclusion.
It is learnt that Pandove had applied for indemnity under Rule 34 of BCCI constitution where the organisation pays on behalf of the member if he is slapped with a penalty while discharging his function.
RBI and Sebi are close to reaching an agreement for providing waiver of existing norms to banks.
These changes will entail a relook at the various laws governing banks in the country - the two Bank Nationalisation Acts (passed in 1970 and 1980); the State Bank of India (SBI) Act of 1955; and the Companies Act of 2013.
The Reserve Bank of India is formulating guidelines that would allow government-owned banks get into the private equity business.
