Reserve Bank of India – Press Releases
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Ajit Prasad Press Release: 2021-2022/339 |
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Month: June 2021
SBI Fixed Deposit: Check Current Penalty Charges & Premature Withdrawal Rules
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SBI Premature Withdrawal Rules And Penalty Charges
- Customers must incur a 0.50 per cent penalty for premature withdrawals from SBI FDs up to Rs 5 lakh across all tenors.
- For premature withdrawals from SBI fixed deposits worth more than Rs 5 lakh but less than Rs 1 On deposits maintained for less than 7 days, no interest will be paid to the holder.
- For additional information, you can get in touch with the customer care team of SBI at toll-free number 1800-425-3800, 1800-11-2211 or 080-26599990.
SBI FD Rates For Regular Customers
Following the most recent adjustment, which took effect on January 8, 2021, SBI FDs with maturities ranging from 7 to 45 days will now return 2.9 per cent interest. Term deposits with terms ranging from 46 to 179 days will yield 3.9 per cent. FDs with maturities ranging from 180 days to less than one year will offer 4.4 per cent. Deposits with maturities ranging from one year to less than two years will fetch a 5% interest rate. FDs maturing in two to three years will yield 5.1 per cent. FDs maturing in 3 to 5 years will give 5.3 per cent, while term deposits maturing in 5 to 10 years will give 5.4 per cent.
| Tenure | Regular FD Rates |
|---|---|
| 7 days to 45 days | 2.90% |
| 46 days to 179 days | 3.90% |
| 180 days to 210 days | 4.40% |
| 211 days to less than 1 year | 4.40% |
| 1 year to less than 2 year | 4.90% |
| 2 years to less than 3 years | 5.10% |
| 3 years to less than 5 years | 5.30% |
| 5 years and up to 10 years | 5.40% |
| Source: SBI, W.e.f. 08.01.2021 |
SBI FD Rates For Senior Citizens
SBI provides elderly people with an additional 50 basis points on all tenors. Senior citizens will receive 3.4 per cent to 6.2 per cent on FDs maturing in 7 days to 10 years, according to the most recent modification. The SBI special FD scheme for the elderly would give interest rates that are 80 basis points (bps) higher than the rate offered to standard depositors. SBI now provides a 5.4 per cent interest rate on five-year fixed deposits to the general public. In contrast, the present interest rate for senior citizens is set at 6.20 per cent under the special FD scheme.
| Tenure | Senior Citizen FD Rates |
|---|---|
| 7 days to 45 days | 3.40% |
| 46 days to 179 days | 4.40% |
| 180 days to 210 days | 4.90% |
| 211 days to less than 1 year | 4.90% |
| 1 year to less than 2 year | 5.50% |
| 2 years to less than 3 years | 5.60% |
| 3 years to less than 5 years | 5.80% |
| 5 years and up to 10 years | 6.20% |
| Source: SBI |
4 Special FD Schemes Available For Senior Citizens Till June 30, 2021
Important update for SBI customers
The State Bank of India (SBI), India’s largest lender, is going to modify the guidelines and charges for cash withdrawals from its ATMs and bank branches. The new restriction will go into force next month, according to the lender. The revised fees will apply to holders of Basic Savings Bank Deposit (BSBD) accounts. Every month, BSBD account users will be able to make four free cash withdrawals from ATMs and bank branches. For any transaction that exceeds the free limit, the bank will charge a fee of Rs 15 + GST. Cash withdrawal fees will apply at home branches, ATMs, and non-SBI ATMs. BBSD account holders will get 10 free cheque leaves every fiscal year from the bank. Following that, SBI will impose a fee for issuing cheques, which will be Rs 40 plus GST for 10 cheque leaves, Rs 75 plus GST for 25 cheque leaves, and Rs 50 plus GST for 10 leaves for an emergency Cheque Book. Senior persons, on the other hand, will be excluded from these cheque book service charges.
Non-financial and transfer (at all branch and other channels) transactions by BBSD account holders at home and non-home branches will be free of charge. SBI has officially upped the amount of cash that can be withdrawn by cheque to Rs 1 lakh per day. The daily limit for cash withdrawals using a withdrawal form and a savings bank passbook has been raised to Rs 25,000. Furthermore, third-party cash withdrawals have been limited to Rs 50,000 per month by cheque only. No cash payments to third parties via withdrawal forms will be permitted. The new ceilings are effective until September 30, according to the bank.
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India Inc cut Rs 1.7 lakh crore debt during pandemic, leave banks high and dry, BFSI News, ET BFSI
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Ignoring the government exhortations to unleash animal spirits and step up investments in the country, India Inc preferred to play safe during the pandemic.
The corporate world focused on deleveraging high-cost loans through fund raising via bond issuances despite interest rates at an all-time low. This has led to muted credit growth for banks.
According to data analysis SBI research wing, the top 15 sectors with more than 1,000 listed entities reported over Rs 1.7 lakh crore of debt reduction in 200-21.
Refineries, steel, fertilizers, mining & mineral products, and textile alone reduced debt by more than Rs 1.5 lakh crore during FY21.
Fertilizers, mining and minerals, FMCG, cement products, consumer durables, and capital goods were among the sectors where loan reduction of 20 per cent or more was reported during FY21.
According to data from the Reserve Bank of India, loan growth fell to a 59-year low of 5.6% on year as of March 31. Credit was logging a 6.4% in the previous fiscal.
Low interest rates
As interest rates drop to an all-time low, corporates are reducing their loan liabilities to facilitate a lower finance cost, which resulted in the primary issuance of bonds to increase by nine per cent.
The spread of AAA bonds for a 10-year tenor declined from 124 bps in April 2020 to 70 bps in April 2021.
Similarly, the spread for 5 year and 3-year bonds declined from 89 bps and 147 bps in April 2020 to 9 bps and 30 bps in April 2021 respectively.
“This trend is continuing in FY22 also,” said Soumya Kanti Ghosh, Group Chief Economic Adviser, State Bank of India.
These companies not only reduced their loan liabilities at lower finance cost, but also increased their cash and bank balance by around 35% in March, as compared to March 2020, suggesting a conservative approach to conserve cash during uncertain times.
Corporate willingness for new investments also remains tepid as the economy is still recovering from the second wave.
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Skybridge Capital Sees More Upside In BTC Than Gold; Expects BTC To Hit $100,000 Before Year End
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Investment
oi-Roshni Agarwal
|
Global investment firm Skybridge Capital’s Chief Investment officer is of the view that bitcoin has more upside potential in comparison to gold. Though both the asset classes i.e. gold and bitcoin are set for a rally, his hedge fund prefers bitcoin over gold.
As per a Bloomberg report released on Sunday, Troy Gayeski- co-chief investment officer (CIO) and senior portfolio manager at Skybridge Capital, a hedge fund with AUM of $7.5 billion said “gold is good but bitcoin is better”.
Gayeski see both gold and bitcoin to spurt despite Federal Reserve considering to shift US monetary policy and gradually taper its asset purchase programme. “We’re going to stick to bitcoin and crypto because we just think there’s more upside”, he added. Further while he acknowledged that bitcoin has more volatility in comparison to gold, he at the same time opined “you’re going to capture a little bit more juice than you will in gold from that same phenomenon.”
The bitcoin price scaled to an all time high of sub $65k in April before it plunged and currently quotes at $32,972 as per Coindesk.com. At the same time, the precious yellow metal gold which was close to fall into a bear territory in March, recovered in price and erased its year to date losses.
“All fiat-currency alternatives – which have all gone through fairly recent substantial corrections – are in a much better place now to handle that eventual taper and gradual slowing of money-supply growth, than they were as they were making higher-highs after higher-highs”, Gayeski added.
Price prediction for bitcoin
The compnay’s founder – Anthony Scaramucci estimates bitcoin to scale to $100,000 before the year-end owing to heavy demand for the crypto-asset and at the same time on account of its diminishing supply. Also check the price prediction of other top cryptocurrencies to invest in 2021.
GoodReturns.in
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Banks stare at over Rs 40,000 crore haircut in Videocon resolution, BFSI News, ET BFSI
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Lenders to Videocon Industries face over Rs 40,000 haircut after the National Company Law Tribunal allowed billionaire Anil Agarwal’s Twin Star Technologies to take over Videocon Industries Ltd for about Rs 3,000 crore.
Twin Star, a part of Vedanta Group, will pay around Rs 500 crore within 90 days as upfront payment and the rest as non-convertible debentures over a period of time.
The offer by the Dhoot family entailed repayments until 2035, which was not acceptable to many banks on Videocon’s Committee of Creditors (CoC), according to reports. Dhoot’s settlement offer was made for 13 out of the 15 Videocon group companies, which are jointly going through the Corporate Insolvency Resolution Process (CIRP). Two group companies — KAIL and TREND — were not covered under the offer. Though the bid is less, the Twin Star offer of Rs 3,000 crore is slightly higher than the liquidation amount of Rs 2,600 crore.
Videocon Industries and its 13 group entities owe Rs 61,770 crore to financial creditors. The State Bank of India claim is Rs 11,152 crore while IDBI Bank owes Rs 9,922 crore.
The Committee of the Creditors of Videocon Industries had voted in favour of the resolution plan of Twin Star Technologies Ltd, for 13 group companies with 95 per cent votes on December 11, 2020.
The NCLT order
A two-member Mumbai bench of the NCLT comprising members – H P Chaturvedi and Ravikumar Duraisamy – approved the resolution plan by Twin-Star Technologies.
Videocon Industries also confirmed the development through a regulatory filing. NCLT has pronounced the order on June 8, 2021 (Tuesday) approving the Resolution Plan for the Consolidated Corporate Debtors including the Company, under Section 31 of the Code, it said.
“The Approval Order has not yet been published and is currently awaited. Videocon Industries further informed, “in terms of the Resolution Plan, the equity shares of the Company are proposed to be delisted”.
Accordingly, an appropriate disclosure would be made upon receipt of the copy of the order by the NCLT approving the Resolution Plan, it added. This approval will also now consolidate Vedanta’s hold in Ravva oil field. Vedanta’s interest in Videocon is principally driven by the latter’s 25 per cent stake in the Ravva oil field in the KG Basin.
Following that the resolution plan was moved by the resolution professional before NCLT.
Later, the resolution Plan, as approved by the CoC, was filed with the NCLT for its approval on December 15, 2020. NCLT has conducted a consolidated corporate insolvency resolution process by combining Videocon Industries and other 12 Videocon group companies.
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Banks stare at over Rs 40,000 crore haircut in Videocon resolution, BFSI News, ET BFSI
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Lenders to Videocon Industries face over Rs 40,000 haircut after the National Company Law Tribunal allowed billionaire Anil Agarwal‘s Twin Star Technologies to take over Videocon Industries Ltd for about Rs 3,000 crore.
Twin Star, a part of Vedanta Group, will pay around Rs 500 crore within 90 days as upfront payment and the rest as non-convertible debentures over a period of time.
The offer by the Dhoot family entailed repayments until 2035, which was not acceptable to many banks on Videocon’s Committee of Creditors (CoC), according to reports. Dhoot’s settlement offer was made for 13 out of the 15 Videocon group companies, which are jointly going through the Corporate Insolvency Resolution Process (CIRP). Two group companies — KAIL and TREND — were not covered under the offer. Though the bid is less, the Twin Star offer of Rs 3,000 crore is slightly higher than the liquidation amount of Rs 2,600 crore.
Videocon Industries and its 13 group entities owe Rs 61,770 crore to financial creditors. The State Bank of India claim is Rs 11,152 crore while IDBI Bank owes Rs 9,922 crore.
The Committee of the Creditors of Videocon Industries had voted in favour of the resolution plan of Twin Star Technologies Ltd, for 13 group companies with 95 per cent votes on December 11, 2020.
The NCLT order
A two-member Mumbai bench of the NCLT comprising members – H P Chaturvedi and Ravikumar Duraisamy – approved the resolution plan by Twin-Star Technologies.
Videocon Industries also confirmed the development through a regulatory filing. NCLT has pronounced the order on June 8, 2021 (Tuesday) approving the Resolution Plan for the Consolidated Corporate Debtors including the Company, under Section 31 of the Code, it said.
“The Approval Order has not yet been published and is currently awaited. Videocon Industries further informed, “in terms of the Resolution Plan, the equity shares of the Company are proposed to be delisted”.
Accordingly, an appropriate disclosure would be made upon receipt of the copy of the order by the NCLT approving the Resolution Plan, it added. This approval will also now consolidate Vedanta’s hold in Ravva oil field. Vedanta’s interest in Videocon is principally driven by the latter’s 25 per cent stake in the Ravva oil field in the KG Basin.
Following that the resolution plan was moved by the resolution professional before NCLT.
Later, the resolution Plan, as approved by the CoC, was filed with the NCLT for its approval on December 15, 2020. NCLT has conducted a consolidated corporate insolvency resolution process by combining Videocon Industries and other 12 Videocon group companies.
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Bank accounts can’t be attached at the cost of Right to Business: Madras HC
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The Madras High Court has held that bank accounts cannot be attached in matters related to GST violation if it is at the cost of doing business. “It is made clear that the attachment proceedings cannot be at the cost of right of provision under Article 19(1)(g) of the Constitution of India,” a single bench of Justice C Saravanan said, while disposing the matter of Chennai-based Marg Human Resources Private Limited.
As a part of the Right to Freedom, Article 19(1)(g) says, “All citizens shall have the right to practice any profession, or to carry on any occupation, trade or business.”
Fraudulent ITC
The petitioner approached the Court after Director General of GST Intelligence (DGGI) issued an order attaching three bank accounts pursuant to a search and investigation ordered against the said company. The allegation against the company was that it had fraudulently availed of input tax credit on fictitious invoices to discharge the GST liability.
The petitioner submitted that the attachment orders have completely strangled the business of the petitioner. It is submitted that the petitioner was employing about 15,000 employees with security guards who were deployed in various industrial units in and around Chennai and Karnataka. It was also said that apart from the ₹5.68 crore which have been appropriated so far against the projected demand of ₹21 crore, the petitioner has agreed to pay another sum of ₹1 crore, within a week.
Also read: E-Invoicing: Simplifying compliance for the taxpayer
Defending the action by the Tax Department, its counsel submitted that the petitioner has indulged in large scale fraud and therefore, the department was compelled to initiate proceedings under Section 67 (deals with inspection, search and seizure in case of violation) of the CGST Act, 2017. He emphasised that the law entitles the Department to order provisional attachment of any assets to protect the interest of the revenue. He also informed that the attachment orders merely freeze the power to debit the account and there is no restriction for receiving the amount.
‘No prejudice to petitioner’
The counsel said that for the last few months, the customers/clients of the petitioner company have directly paid the salaries/wages to the employees including the amount due under the Provident Funds Act and therefore the “continuance of the impugned attachment orders will be of no prejudice to the petitioner.” Tax Department also said that the Directors of the company breached the bail order. After going through all the arguments, the bench noted that nearly 27 per cent of proposed/estimated tax due has already been discharged.
Also read:Monetary policy must remain accommodative
“After all, there is a mechanism provided under the Act for proper adjudication of the tax due and determination under Sections 73 and 74. Therefore, there is no meaning in attaching the bank accounts further,” the Bench said, while asking the I-T Department to complete the investigation and issue appropriate show cause notice.
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SBI union, others urge RBI to scrap digital payments plan
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A union representing India’s largest state-run bank and a global alliance have asked the central bank to bar large companies from setting up payment networks, saying in a letter seen by Reuters on Tuesday that privatisation could compromise data safety.
In a bid to reduce concentration risks in the payments sector, India’s central bank (RBI) last year invited companies to forge so-called New Umbrella Entities (NUEs) to create a payments network that would rival the country’s flagship processor, the National Payments Council of India (NPCI).
The NUE will be allowed to operate new payment systems including digital and ATM transactions. Amazon, Google, Facebook and others have applied for such licences in partnership with Indian companies such as Reliance and ICICI Bank.
Also read: Retail payments: Half-a-dozen consortiums set to apply for NUE licence
Involvement of big multi-national companies raises fears of abuse of user data and India’s digital payment networks should continue to operate on a non-profit basis, the All India State Bank of India (SBI) Staff Federation and the UNI Global Union, a vocal critic of tech giants, wrote in the letter.
Opposes NUE
The letter urged the central bank to scrap the “whole process of NUE licensing” and focus on strengthening the domestic payments group, NPCI, which operates as a non-profit.
The RBI did not immediately respond to a request for comment on the letter, which has previously not been reported.
While state-backed NPCI forms the backbone of the country’s digital payments system, India is an increasingly attractive digital payments market for everyone from Amazon to Google. An Assocham-PWC India study in 2019 said digital payments in India could rise to $135 billion in 2023 from $65 billion in 2019.
In the letter, groups including the SBI union, which represents 100,000 of its nearly 250,000 employees, and UNI Global Union, that represents about 20 million workers globally,specifically raised concerns about the NUE application by a consortium led by Amazon. It highlighted the U.S. company was facing several investigations into its business practices in India and abroad.
Amazon did not immediately respond to a request for comment.
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Continue preserving demonetisation period CCTV footage at branches and currency chests: RBI to banks
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The Reserve Bank of India (RBI) has advised all banks to preserve the CCTV recordings of operations at their branches and currency chests during the demonetisation period (from November 08, 2016 to December 30, 2016) in a proper way, till further orders.
This is in view the investigations pending with law enforcement agencies and proceedings pending at various courts, RBI said in a notification.
The Government had issued a notification on November 8, 2016, withdrawing the legal tender status of ₹500 and ₹1,000 denominations of banknotes of the Mahatma Gandhi Series issued by the Reserve Bank of India.
The Government then said demonetisation of the aforementioned notes was done to tackle counterfeiting Indian banknotes, to effectively nullify black money hoarded in cash and curb funding of terrorism with fake notes.
As per RBI’s mint street memo of August 2017, currency notes of denominations of ₹1000 and ₹ 500 (specified bank notes or SBNs), valued at ₹15.4 lakh crore and constituting 86.9 per cent of the value of total notes in circulation were demonetised.
Preserving CCTV footages
On December 13, 2016, RBI had issued a notification, wherein the banks were advised to preserve the CCTV recordings of operations at bank branches and currency chests for the period from November 08, 2016 to December 30, 2016, until further instructions, to facilitate coordinated and effective action by the enforcement agencies in dealing with matters relating to illegal accumulation of new currency notes.
“In continuation to the above, keeping in view the investigations pending with law enforcement agencies, proceedings pending at various courts, you are advised to preserve the CCTV recordings of operations at bank branches and currency chests for the period from November 08, 2016 to December 30, 2016 in a proper way, till further orders,” RBI said in its notification to banks on Tuesday.
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Banks face ₹42,000-cr haircut as NCLT clears Vedanta firm’s ₹2,900-crore bid for Videocon
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Banks will take a ₹42,000-crore haircut after the Mumbai Bench of the National Company Law Tribunal approved a bid by Anil Agarwal-backed Twin Star Technologies’ to acquire Videocon Industries Ltd for ₹2,900 crore. Claims worth ₹46,000 crore had been admitted under the insolvency process that began in December 2017.
While the NCLT order ensures that the company’s former promoter, Venugopal Dhoot’s offer to take back control has been rejected finally, it also means that banks, led by SBI and IDBI Bank, will have to settle for a low recovery. Videocon, which is in multiple businesses ranging from oils to consumer durables, was controlled by the Dhoot family before lenders dragged it to the NCLT in 2017. Dhoot had promised to repay about ₹30,000 crore for taking back control of the conglomerate under Section 12A of the Insolvency and Bankruptcy Code, which allows the withdrawal of the debt resolution proceedings under NCLT if the majority of the lenders agree to it.
According to banking sources, the offer by the Dhoot family entailed repayments until 2035, which was not acceptable to many banks on Videocon’s Committee of Creditors (CoC). Then, in January, the lenders decided to pick the bid Twin Star Holdings Ltd, a Vedanta Group company. Even though the bid, at less than ₹3,000 crore, was not even 10 per cent of the group’s overall outstanding debt, the CoC went with it because it was slightly higher than the liquidation amount of ₹2,600 crore.
Credited to be the first Indian company to have got a licence to manufacture colour TVs in 1986, the Videocon Group was making air-conditioners, refrigerators and home entertainment systems, foraying later also into oil/gas, telecom, retail and DTH services.
The aggressive expansion led to increased borrowings, and businesses collapsed after Dhoot to into the hyper-competitive telecom market. The debt pile, which was around ₹7,000 crore in 2007, kept soaring.
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