News:The Reserve Bank of India has released a report titled Trend and Progress of Banking in India 2018-19. Facts: Key Highlights from the report: What are the positives in the Banking sector? The Indian banking sector’s financial parameters such as bad loans and capital adequacy have shown an improvement in recent times. In 2018-19, the… Continue reading Economic revival key to banks’ health
Tag: RBI
RBI launches Prepaid Payment Instrument for your daily digital payments
News:The Reserve Bank has introduced a new type of prepaid payment instrument (PPI) for daily digital payments. Facts: Features of PPI introduced by RBI: The prepaid payment instrument(PPI) could be used only for purchase of goods and services up to a limit of ₹10,000 per month. PPIs shall be issued by bank and non-bank PPI… Continue reading RBI launches Prepaid Payment Instrument for your daily digital payments
RBI plans its own ‘Operation Twist’; to buy, sell bonds simultaneously
News:The Reserve Bank of India has announced that it will carry out US-style ‘Operation Twist’ to bring down interest rates. Facts: About Operation Twist: Operation Twist is when the central bank uses the proceeds from the sale of short-term securities to buy long-term government debt papers, leading to easing of interest rates on the long… Continue reading RBI plans its own ‘Operation Twist’; to buy, sell bonds simultaneously
Explained: Why the RBI refused to cut interest rates
News:The Monetary Policy Committee(MPC) of the Reserve Bank of India has decided to keep the repo rate unchanged at 5.15% in its fifth bi-monthly monetary policy statement. Facts: Issues before RBI: The RBI’s most important mandate is to maintain price stability which means RBI is required by law to maintain retail inflation based on Consumer… Continue reading Explained: Why the RBI refused to cut interest rates
Reserve Bank flags rising bad assets from Mudra loans
News:The Reserve Bank of India (RBI) has expressed concern over rising bad loans from Pradhan Mantri MUDRA Yojana(PMMY). Facts: About Rising Bad loans in MUDRA Yojana: The RBI Deputy Governor said that MUDRA was launched with the objective of lifting many beneficiaries out of poverty. However,there have been concerns at the growing level of non-performing… Continue reading Reserve Bank flags rising bad assets from Mudra loans
Monetary policy committee sees further slowdown in growth
News:The Reserve Bank of India(RBI) has released the minutes of the monetary policy committee (MPC) meeting. Facts: In its fourth Bi-monthly policy review,the Reserve Bank of India’s(RBI) Monetary Policy Committee(MPC) has reduced the interest rates by 25 basis points to 5.15 % from 5.40 %. Key takeaways from the MPC meeting: All the six members… Continue reading Monetary policy committee sees further slowdown in growth
Fourth Bi-monthly monetary policy review
News:The Monetary Policy Committee of the Reserve Bank of India(RBI) has cut the key policy rate by 25 basis points to 5.15 %. Facts: Highlights of the Monetary policy: The Reserve Bank of India’s(RBI) Monetary Policy Committee(MPC) has decided to reduce the policy repo rate under the liquidity adjustment facility(LAF) by 25 basis points to… Continue reading Fourth Bi-monthly monetary policy review
Explained: Why RBI may cut interest rates tomorrow and why it may not be enough
News:The Reserve Bank of India’s Monetary Policy Committee is set to announce its bi-monthly policy review on October 4,2019. Facts: What is likely to happen in the policy review? The RBI is likely to cut the repo rate by anywhere between 35 to 40 basis points due to following reasons- Inflation is under control.Hence,there is… Continue reading Explained: Why RBI may cut interest rates tomorrow and why it may not be enough
Prompt Corrective Action (PCA)
What is Prompt corrective action(PCA)? PCA is a framework under which banks with weak financial metrics are put under watch by the RBI. The RBI introduced the PCA framework in 2002 as a structured early-intervention mechanism for banks that become undercapitalised due to poor asset quality, or vulnerable due to loss of profitability. These regulations… Continue reading Prompt Corrective Action (PCA)
Teaser loans
News:The Reserve Bank of India(RBI) may not allow State Bank of India(SBI) plan to offer teaser loans. Facts: About Teaser loans: Teaser loans are those which charge comparatively lower rates of interest in the first few years after which the rates are increased. Why RBI is against teaser loans? The RBI feels that some borrowers… Continue reading Teaser loans
