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Reserve Bank of India – Press Releases

Press Releases

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The Reserve Bank – Integrated Ombudsman Scheme, 2021 (the Scheme) was launched today in virtual mode by Hon’ble Prime Minister Shri Narendra Modi.

2. The Scheme integrates the existing three Ombudsman schemes of RBI namely, (i) the Banking Ombudsman Scheme, 2006; (ii) the Ombudsman Scheme for Non-Banking Financial Companies, 2018; and (iii) the Ombudsman Scheme for Digital Transactions, 2019. The Scheme, framed by the Reserve Bank in exercise of the powers conferred on it under Section 35A of the Banking Regulation Act, 1949 (10 of 1949), Section 45L of the Reserve Bank of India Act, 1934 (2 of 1934), and Section 18 of the Payment and Settlement Systems Act, 2007 (51 of 2007), will provide cost-free redress of customer complaints involving deficiency in services rendered by entities regulated by RBI, if not resolved to the satisfaction of the customers or not replied within a period of 30 days by the regulated entity.

3. In addition to integrating the three existing schemes, the Scheme also includes under its ambit Non-Scheduled Primary Co-operative Banks with a deposit size of ₹50 crore and above. The Scheme adopts ‘One Nation One Ombudsman’ approach by making the RBI Ombudsman mechanism jurisdiction neutral.

4. Some of the salient features of the Scheme are:

  1. It will no longer be necessary for a complainant to identify under which scheme he/she should file complaint with the Ombudsman.

  2. The Scheme defines ‘deficiency in service’ as the ground for filing a complaint, with a specified list of exclusions. Therefore, the complaints would no longer be rejected simply on account of “not covered under the grounds listed in the scheme”.

  3. The Scheme has done away with the jurisdiction of each ombudsman office.

  4. A Centralised Receipt and Processing Centre has been set up at RBI, Chandigarh for receipt and initial processing of physical and email complaints in any language.

  5. The responsibility of representing the Regulated Entity and furnishing information in respect of complaints filed by customers against the Regulated Entity would be that of the Principal Nodal Officer in the rank of a General Manager in a Public Sector Bank or equivalent.

  6. The Regulated Entity will not have the right to appeal in cases where an Award is issued by the ombudsman against it for not furnishing satisfactory and timely information/documents.

5. The Executive Director-in charge of Consumer Education and Protection Department of RBI would be the Appellate Authority under the Scheme.

6. Complaints can continue to be filed online on https://cms.rbi.org.in. Complaints can also be filed through the dedicated e-mail or sent in physical mode to the ‘Centralised Receipt and Processing Centre’ set up at Reserve Bank of India, 4th Floor, Sector 17, Chandigarh – 160017 in the format. Additionally, a Contact Centre with a toll-free number – 14448 (9:30 am to 5:15 pm) – is also being operationalised in Hindi, English and in eight regional languages to begin with and will be expanded to cover other Indian languages in due course. The Contact Centre will provide information/clarifications regarding the alternate grievance redress mechanism of RBI and to guide complainants in filing of a complaint.

7. A copy of the Scheme is available on the RBI website and on the CMS portal (https://cms.rbi.org.in). The Scheme will be effective from today.

(Yogesh Dayal)     
Chief General Manager

Press Release: 2021-2022/1184

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Airtel Payments Bank to double business correspondent network to 1 million in a year, BFSI News, ET BFSI

Personal Finance

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Airtel Payments Bank (APB), which turned profitable in the September quarter, plans to double its countrywide business correspondents (BCs) network and also drive monetisation through a combination of transactions and interest-based income besides boosting revenues from cash management services in the B2B space, senior industry executives aware said.

“Over the next 12 months, APB is looking to double its pan-India BC network to 1 million (from the current 0.5 million level) to gain the necessary reach to cater to the remittances market and the Aadhaar-enabled payment services business to serve millions of potential consumers in the Tier 3 and beyond markets,” one of the executives cited told ET.

Analysts expect the upcoming expansion to further widen APB’s total distribution reach, which is already twice that of the total ATMs and bank branches in the country, and in turn, consolidate its leadership in the remittances market.

At press time, Airtel did not respond to ET’s queries.

Airtel Payments Bank turned PAT-positive in the September quarter, on the back of a 16% sequential growth in its monthly transacting user base to 31.2 million and a 25% on-quarter jump in its gross merchandise value (GMV) to Rs 32,100 crore. Its revenue is close to Rs 1,000 crore on an annual basis.

Company insiders estimate the remittances market to grow at 70% over the next few years and the Aadhaar-enabled payment services business to grow by over 45% compounded annually over the next four years.

IIFL Securities sees strong revenue generation potential in the B2B segment by way of cash management services, especially since APB’s take rate at 0.74% is the highest in the payments banking space. The take rate is a metric to measure conversion of ABP’s GMV into revenue.

Bharti Airtel managing director Gopal Vittal had recently said that the “growth of e-commerce is slated to boost demand for cash management” from the telco’s payments banking arm,” and that whopping “$100 billion in cash is digitised monthly (at an industry level) with cash management charges estimated at between 0.5%-1% of the collections amount”.

Airtel, though, declined to comment on the telco upgrading its payments bank licence to that of a small finance bank in future to enter the lending business and attract larger deposits. Whenever that happens, APB will be able to use deposits from its 115 million users more profitably, say industry executives.

Last December, Bharti chairman Sunil Mittal had said Airtel may upgrade its payments bank licence to that of a small finance bank at some point to enter the lending business.



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Reserve Bank of India – Press Releases

Press Releases

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    4.26% GS 2023 NEW GS 2026 6.67% GS 2035 NEW GS 2051
I. Notified Amount ₹2,000 cr ₹6,000 cr ₹9,000 cr ₹7,000 cr
II. Cut off Price / Implicit Yield at cut-off 99.65/4.5029% 5.7400% 98.90/6.7927% 6.9900%
III. Amount accepted in the auction ₹2,000 cr ₹6,000 cr ₹9,000 cr ₹7,000 cr
IV. Devolvement on Primary Dealers Nil Nil Nil Nil

Ajit Prasad           
Director (Communications)

Press Release: 2021-2022/1182

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‘We are adopting a cluster approach to boost MSME credit’

Banking & Finance

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Top public sector lender State Bank of India says its Chennai Circle is one of the important business regions with its leadership in advances, and agri gold loans. R Radhakrishnan, who took charge as the Chief General Manager (CGM) of State Bank of India (SBI), Chennai Circle in June this year spoke to BusinessLine about the circle’s growth areas and expansion plans. Excerpts

How was the September 2021 quarter for Chennai Circle?

Chennai Circle’s performance was fairly good in Q2FY22. In terms of growth in deposits and advances, we have achieved 47% of our annual budget in deposits and 13% of our annual budget in advances.

Have collection efficiencies across segments reached pre-Covid levels in this region?

There has been significant reduction in slippages during Q2FY22 vis-à-vis Q1FY22. The slippages decreased by 73%. The NPA percentage has also improved from 2.91% as on June 30, 2021 to 2.25% as on September 30, 2021 which is below pre-Covid level. Collection efficiency in the SME sector has not yet reached pre-Covid level. Though all out efforts are being taken to revive units through restructuring and Covid related supports, SME units are struggling to recover from the losses incurred due to lock down, cancellation of orders and migration of labour.

You are a big player in the MSME segment and TN is also known for MSMEs. How big is the MSME portfolio and how has it grown in the past few years ?

Presently the Circle is having an SME Portfolio of ₹21,000 crore excluding our large & mid corporate portfolio of ₹58,061 crore. In total, we are having exposure of ₹80,000 crore in SME. Our MSME portfolio stands at ₹14,462 crore. We have exposure to manufacturing and retail trade in various sectors such as textiles, heavy commercial vehicles, auto components, automobiles, leather, fabrication, cement, sugar, paper, IT related services and safety matches.

The Tamil Nadu government recently announced MSME Policy 2021 and set a target to attract ₹2 trillion in new investments in the MSME sector by 2025 and achieve an annual growth of 15% in the manufacturing sector. We have also planned to increase our MSME portfolio by ₹3,756 crore by the end of March 2022. We are adopting a cluster approach to grow in each segment of the MSME spectrum. We have also launched Sanjeevani & Aarogya MSME loan products targeting the health sector.

What are some of the major growth areas for this circle?

The Circle has a total business portfolio of ₹3.08 trillion with ₹1.83 trillion in deposits and ₹1.25 trillion in advances. Its portfolio is almost equally distributed in SME, agri and retail segments. Home loan segment contributes to 38% of total advances. Some of the major growth areas for this Circle are retail loans, housing loans, gold loans, SHGs and MSME Loans.

How does Chennai circle compare with other zones of SBI?

Chennai Circle consists of 1,247 branches spread over the geographical area of Tamil Nadu & Pondicherry. Our branch share is 10.60%. Our deposit share is 18.20 % and advances share is 17.50 % among all the banks in this zone. We have a network of 5,348 ATM/ADWMs with a market share of 19%. Chennai Circle stands pan-India No.1 in aggregate advances & agri gold loans. It has the third highest portfolio in housing loans.

What are your business targets for this fiscal and how are you planning to achieve the same?

For FY 2021-22, we have planned to grow ₹10,386 crore in CASA deposits and ₹19,433 crore in total deposits. We have planned to grow our aggregate advances portfolio by ₹19,138 crore.

Could you also provide details on the branch expansion/ rationalisation plans?

Last financial year, we opened 22 branches including 10 SME branches. As on date, we have 2,742 Customer Service Points (CSPs) in Chennai Circle apart from 1,247 branches. We are planning to open 700 CSPs during this fiscal and 3 more branches to extend our services in unbanked areas.

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PM Modi, BFSI News, ET BFSI

Personal Finance

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New Delhi [India], November 12: Prime Minister Narendra Modi on Friday lauded the use of Unified Payments Interface (UPI) across the country and said the digital transactions in India has jumped 19 times in the last seven years.

“UPI has become the world’s leading country in terms of digital transactions in a very short span of time. In just seven years, digital transactions in India has jumped 19 times. Today our banking system is operational 24 hours, 7 days and 12 months anytime, anywhere in the country,” the Prime Minister said while speaking at the launch of two customer-centric initiatives of RBI.

PM Modi said, “Till 6-7 years ago, banking, pension, insurance, everything used to be like an ‘exclusive club in India’. Common citizens of the country, poor families, farmers, small traders-businessmen, women, Dalits-deprived-backwards, all these facilities were far away for all of them.”

The Prime Minister further pointed out that earlier, there were no bank branches, no staff, no internet, no awareness in the banking sector.

“The people who had the responsibility of taking these facilities to the poor also never paid any attention to it. Rather, various excuses were made for not changing. It was said that there is no bank branch, no staff, no internet, no awareness, no idea what were the arguments,” the Prime Minister said.

The Prime Minister also lauded the role of cooperative banks in strengthening the banking sector.

“To further strengthen the banking sector, cooperative banks were also brought under the purview of RBI. Due to this the governance of these banks is also improving and the trust in this system is getting stronger even among the lakhs of depositors who are there,” he said.

Earlier today, PM Modi launched two innovative customer-centric initiatives of the Reserve Bank of India.

The RBI Retail Direct Scheme is aimed at enhancing access to the government securities market for retail investors. It offers them a new avenue for directly investing in securities issued by the Government of India and the State Governments. Investors will be able to easily open and maintain their government securities account online with the RBI, free of cost.

The Reserve Bank – Integrated Ombudsman Scheme aims to further improve the grievance redress mechanism for resolving customer complaints against entities regulated by RBI. The central theme of the scheme is based on ‘One Nation-One Ombudsman’ with one portal, one email and one address for the customers to lodge their complaints.

There will be a single point of reference for customers to file their complaints, submit the documents, track status and provide feedback. A multi-lingual toll-free number will provide all relevant information on grievance redress and assistance for filing complaints.

India’s Prime Minister Narendra Modi



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Indian-origin partner at McKinsey arrested; charged with insider-trading, BFSI News, ET BFSI

Personal Finance

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By Yoshita Singh (Eds: Updating with more details) New York, Puneet Dikshit, a 40-year-old Indian-origin partner at management consulting giant, McKinsey & Company, has been arrested and charged with insider-trading and making illegal profits totalling over USD 450,000 in the US.

Dikshit, a partner at a global management consulting firm, has been charged with “illegally trading in advance of a corporate acquisition by one of the firm’s clients in September,” the Securities and Exchange Commission (SEC) said in a statement on Wednesday.

Dikshit, who was arrested on Wednesday and charged with two counts of securities fraud – violating Section 10(b) of the Securities Exchange Act of 1934 and Rule 10b-5 thereunder – faces up to 20 years in prison on each count, the Department of Justice said in a press release.

US Attorney for the Southern District of New York Damian Williams and Assistant Director-in-Charge of the New York Field Office of the Federal Bureau of Investigation Michael Driscoll announced the unsealing of the criminal complaint against Dikshit.

The SEC’s complaint, filed in federal district court in Manhattan, alleges that in the course of providing consulting services, Dikshit learned highly confidential information concerning The Goldman Sachs Group Inc.’s impending acquisition of GreenSky Inc (GSKY).

According to the SEC’s complaint, in the days leading up to the acquisition announcement on September 15, 2021, Dikshit used this information to purchase out-of-the-money GreenSky call options that were set to expire just days after the announcement.

He sold all of the call options referencing GSKY on September 15, 2021, realising profits of over USD 450,000, a return on investment of approximately 1,829 per cent.

The SEC’s complaint further alleges that Dikshit violated his firm’s policies by failing to pre-clear these options purchases. “In total, Dikshit realised profits of more than USD 450,000 from his insider trading in GSKY options, a return on investment of approximately 1,829 per cent.”

“Dikshit knew or was reckless is not knowing that the information he had obtained from Consulting Firm and Goldman concerning the acquisition of GreenSky was material and nonpublic, and that he owed a duty to Consulting Firm and Goldman to keep that information confidential and to refrain from trading on it,” the SEC said.

The SEC said that by trading in GSKY securities on the basis of material nonpublic information that he had obtained from the consulting firm and Goldman, “Dikshit breached a duty of trust or confidence to Consulting Firm and Goldman.”

“As alleged, Puneet Dikshit, a consulting firm partner, exploited his access to material nonpublic information about a pending acquisition of GreenSky, Inc., to trade in GreenSky call options. This breach of duties to his firm and its investment bank client – and violation of the law – allegedly reaped the defendant nearly half a million dollars in illegal profits. Now Puneet Dikshit has been charged with serious felonies for his alleged conduct,” Williams said.

According to the allegations in the Complaint unsealed Wednesday in Manhattan federal court, GreenSky was a publicly traded financial technology company that provided technology to banks and merchants to make loans to consumers for home improvement, solar, healthcare, and other purposes.

Between on or about November 2019 and July 2020, and again between April 2021 and September 2021, Goldman engaged McKinsey to provide various consulting services related to its consideration of an acquisition of GreenSky and the post-acquisition integration of GreenSky.

Dikshit was one of McKinsey’s partners leading these engagements. In that role, he had access to material, nonpublic information, which he misappropriated and, in violation of the duties that he owed to Goldman and McKinsey, used to trade GreenSky call options.

He engaged in this trading between on or about July 26, 2021, and on or about September 15, 2021 – at the same time he was leading the McKinsey team that was advising Goldman about its potential acquisition of GreenSky.

At various times between on or about July 26, 2021, and on or about September 13, 2021, Dikshit purchased and sold relatively small numbers of GreenSky call options, which had expiration dates weeks or months from the time of purchase.

However, in the two days before the September 15, 2021, public announcement that Goldman would be acquiring GreenSky, he sold all of these longer-dated GreenSky call options and purchased approximately 2,500 out-of-the-money GreenSky call options that were due to expire just a few days later, on September 17, 2021.

After the deal was announced, he sold these calls and realised profits of approximately USD 450,000

Dikshit’s lawyers at Kramer Levin did not immediately respond to requests for comment, CNBC reported.

“We have terminated the employment of a partner for a gross violation of our policies and code of conduct. We have zero tolerance for the appalling behavior described in the complaint, and we will continue cooperating with the authorities,” McKinsey told CNBC news outlet.

“We allege that Dikshit breached duties to his employer and his client by misusing their confidential information for his own financial gain. Thanks to our trading analysis tools, we were able to move swiftly to hold him accountable for his actions and protect the fairness of our securities markets,” Joseph G Sansone, chief of the SEC’s Market Abuse Unit, said in a statement.

In 2012, former Goldman Sachs director and former Managing Director of McKinsey Rajat Gupta was sentenced to two years in prison after being found guilty in 2012 of passing confidential boardroom information about Goldman Sachs to then hedge fund founder Raj Rajaratnam. Gupta served 19 months in prison and was released in 2016.



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Reserve Bank of India – Tenders

Tenders

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E-Tender No. RBI/Bengaluru/Estate/168/21-22/ET/227

E-tenders were invited for Empanelment of vendors and award of work for Annual Maintenance Contract (AMC) and Facility Management Service (FMS) of Computer Hardware, Software and Peripherals at Reserve Bank of India, Bengaluru after publishing the NIT in MSTC Portal and on the Bank’s website. As per the schedule, the Pre-Bid Meeting for the captioned tender was held November 10, 2021 at 03.00 PM at Board Room, 4th Floor, Reserve Bank of India, Bengaluru.

The meeting was attended by the following:

From Banks’ side: 1) Shri Shriram Zamre, Assistant Manager

2) Shri Yugandhara Ramesh M, Assistant

From vendor side: 1) Shri. Dhanunjaya Choudary Pathakumari, M/s Aforeserve Services Limited

2) Shri. Satish Gowda, M/s Accel Limited

3) Shri. Syed Rafi, M/s Microsun Infocare Service Limited

The following queries were raised by the participants and clarified:

Sl. No Clause in NIT Query Raised Clarification
1 Pg No. 26, Point 5 of Section 4 Confirm whether MSME bidders are exempted from paying Earnest Money Deposit (EMD). MSEs are exempted from submission of EMD only in cases where the estimated cost of procurement (Goods, Services or Work Contracts) is upto Rs. 10 Lakh (including all taxes, duties etc.). In the extant case, the estimated cost of the tender is more than Rs. 10 lakh and therefore submission of EMD is compulsory.
2 Pg No. 36, Annexure IV Is it mandatory to obtain feedback from existing client on Letter head of client? Seal and signature of the authorised person will work? It is preferable to get the feedback regarding performance of vendor on the Letter Head of Client. It should be ensured that all the details mentioned in the annexure IV are provided with.
3 Pg No. 23, Point No. 16 of Section 3 What are the requirements for minimum wages to be paid to the vendors staff? Please refer to the point 16 of section 3 of Tender Document.

The Vendor is bound to follow all Labour rules and regulations as envisaged in the Payment of Wages Act 1936 and Minimum Wages Act 1948, of Central Government and ensure payment of minimum wages which should be based on total man days and/or working hours, which are revised time to time by the competent authority.

4 Pg No. 22, Point 10 of Section 3 What spare inventory is needed to be maintained? Please refer to the point no. 10 of section 3 of Tender Document. The vendor shall maintain an onsite inventory of spare parts for PC, Laptops, printers, etc. so as to ensure business continuity in the case of any malfunction of the equipment’s. All necessary spares to ensure 99% uptime of each PC and 99% uptime of each peripheral covered under the AMC. If during any quarter, the vendor does not maintain the uptime of the equipment, proportionate maintenance charges will be deducted from the amount to be paid to the vendor in the beginning of the next quarter. The minimum inventory of spares to be maintained at RBI at all times is as follows:

a) CD Rom – 2 No.

b) Keyboards – 5 Nos.

c) USB Mouse – 5 Nos.

d) Wireless Keyboard and Mouse sets – 2 sets.

e) Compatible SMPS – 5 Nos.

f) and any other item to maintain equipment uptime as indicated above.

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Auto debit bounce rates drop in Oct to pre-Covid levels, may fall further in festive season, BFSI News, ET BFSI

Banking & Finance

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Auto-debit payment bounce rates have dropped to near pre-Covid levels in October in tandem with the opening up of the economy as the pandemic retreated.Of the 86.6 million transactions initiated in October, 27 million transactions, or 31.24 per cent, failed, while 59.52 million were successful, according to the NACH data.
In value terms, 24.83 per cent of the transactions declined in October — the lowest since January 2020.

Volume-wise, the bounce rates were at similar levels seen during pre-Covid wave months of January and February of 2020, and by value, 260 basis points (bps) better than January-March 2021 period, which was the best quarter last year in terms of recovery for the economy.

Improvement over September

On a month-on-month basis, bounce rates have declined 50-60 bps by volume/value. Bounce rates were 31.7% and 25.4% by volume and value, respectively, for September. In August, these figures were at 33% and 26.8% by volume and value, respectively, while in July they were 33.2% and 27.4% by volume and value.

Despite the steady improvement, bounce rates continued to remain above the average levels of 2019. The current bounce rates by value are nearly 300 basis points higher than pre-Covid levels. Most banks and non-bank lenders have reported an increase in fresh disbursements and improvement in collections continues to remain their top priority.

Collection efficiencies

Collection efficiency improved in the September quarter, though slippages have been high in the retail and MSME segment the quantum is likely to have moderated sequentially, keeping asset quality in check, according to analysts.

Typically, auto-debit transactions are for recurring payments such as EMIs and insurance premiums although it does not capture intra-bank transactions. With the second wave of the pandemic leading to localised lockdowns and impacting economic activities, bounce rates had started to climb up from April 2021 after easing from December 2020.

In the last two months, as Covid cases have come down in most parts of the country and the economy has opened up again, bounce rates have started coming down again. Many lenders have reported that collection efficiencies have returned to normal and are at the pre-second wave levels.

Asset quality recovery

Non-bank lenders and housing finance companies, which suffered during the first quarter of this fiscal, are likely to report a steady recovery in asset quality and demand for fresh loans along with improved payment collections in the September quarter.

“The first quarter of fiscal 2022 was impacted by the second Covid wave. Relative to 1QFY22, we expect disbursement volumes of 170-230% for most Affordable Housing/Vehicle Financiers. Impact on AUM growth is likely to be higher for short duration products like Vehicle loans as collections held up well in 2QFY22,” Motilal Oswal Securities said in a note.

For vehicle financiers, or MFIs, the collection efficiencies are likely to be in the 90-100% range. After the high levels of restructuring witnessed in 1Q, a relatively lower incremental restructuring is likely in the second quarter.



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Fino Payments Bank shares list with nearly 6 pc discount, BFSI News, ET BFSI

Banking & Finance

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New Delhi, Shares of Fino Payments Bank Ltd made a tepid market debut on Friday, listing with a discount of nearly 6 per cent from its issue price of Rs 577. The stock made its debut at Rs 548, a decline of 5 per cent from the issue price on the BSE. It later dipped 7.15 per cent to Rs 535.70.

At the NSE, it listed at Rs 544.35, lower by 5.65 per cent.

The Rs 1,200.3-crore IPO had a price range of Rs 560-577 per share for the offer.

Fino Payments Bank or FPBL is a scheduled commercial bank serving the emerging Indian market with its digital-based financial services.

The company is a fully-owned subsidiary of Fino Paytech, a pioneer in technology-enabled financial inclusion solutions.

Fino Paytech is backed by investors like Blackstone, ICICI Group, Bharat Petroleum and International Finance Corporation (IFC).



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