RBI removes lending restrictions on microfinance company Arohan Financial Services

• Restrictions removed from: Microfinance company Arohan Financial Services

• Removed by: Reserve Bank of India (RBI)
• Reason: After it became satisfied with the company's revamped processes as well as its
commitment to adhere to the regulatory guidelines.
• On October 17, 2024, the regulator had barred Arohan, Asirvad Micro Finance and two
other non-banks -- Navi Finserv and DMI Finance -- from lending due to "unfair and
usurious practices" and non-adherence to the regulatory guidelines.
RBI okays NCBL, Cosmos Co-operative bank merger
• Merger of: National Co-operative Bank Ltd., Bangalore with Cosmos Co-operative
Bank Limited
• Approved by: RBI
• Following this, branches of NCBL will operate as Cosmos branches. The scheme has
been sanctioned in exercise of the powers conferred under Sub-Section (4) of Section
44A read with Section 56 of the Banking Regulation Act, 1949
• Earlier on December 31, RBI imposed a monetary penalty of Rs 8.30 lakh as Cosmos
Bank has violated the rules by applying foreclosure charges on floating rate term loans,
sanctioned to certain individual borrowers.

3 Types Of Bank Account Will Be Closed From January 1, 2025 : RBI

• Starting January 1, 2025, the Reserve Bank of India (RBI) will make three types of
bank accounts non-operative as part of a move to improve the banking system’s
efficiency, safety, and transparency.
• Types of Accounts Becoming Non-Operative:
• Dormant Accounts: Accounts that have not had any transactions for two years.
• Inactive Accounts: Accounts with no activity for a fixed period, often one year.
• Zero Balance Accounts: Accounts with no money deposited for a long time and a zero
balance.
• The RBI Udgam Portal, officially launched by the Reserve Bank of India (RBI) on 17
August 2023.
• UDGAM refers to Unclaimed Deposits-Gateway to Access inforMation
• Developed in collaboration with Reserve Bank Information Technology (ReBIT) and
Indian Financial Technology & Allied Services (IFTAS).
• UDRN is a unique number generated through Core Banking Solution (CBS) by banks
and assigned to each Unclaimed account/ deposit transferred to Depositor Education
and Awareness (DEA) Fund of RBI.
• As on March 4, 2024, there are 30 banks registered under UDGAM.

RBI Tightens Liquidity Norms for Deposit-Taking HFCs

 • The Reserve Bank of India (RBI) has implemented revised norms requiring deposit-
taking housing finance companies (HFCs) to maintain higher levels of liquid assets
against their deposits.
• Effective from: January 1, 2025
• These companies must hold liquid assets equivalent to 14% of their outstanding
deposits.
• This includes 8% in unencumbered approved securities, calculated as a percentage of
public deposits.
• Furthermore, the RBI has mandated that by July 1, 2025, the total liquid assets
requirement will increase to 15%, including 10% in unencumbered approved securities.
• Prior to this update, deposit-taking HFCs were required to maintain 13 per cent of their
public deposits as liquid assets.
• The phased increase to 15 per cent ensures a more robust liquidity framework, aiming
to safeguard depositors’ interests and enhance financial stability.
• Unencumbered approved securities:
• Dated securities of the Government of India or
• Treasury Bills of the Government of India; or
• State Development Loans (SDLs) of the State Governments
• Unencumbered approved securities are securities that are not pledged as collateral or
deposits and are issued by the Central Government or a State Government.
• RBI ADDA : RBI@90 All India Public Sector Badminton Tournament at Bengaluru
**** 15 Teams.

RBI keeps interest rate on floating rate savings bonds unchanged at 8.05%
• Annoncement of: Interest rate for RBI Floating Rate Savings Bonds
• Announced by: Reserve Bank of India
 • Tenure: January to June 2025 on January 1, 2025.
• The RBI Floating Rate Savings Bond (FRSBs), 2020 (Taxable) will offer 8.05% interest
rates from January to June 2025.
• It is linked to the interest rate of the National Savings Certificate (NSC)
• The interest rate of RBI Floating Rate Savings Bonds is 0.35% higher than what NSC
offers.
• Lock-in period: Seven years
• There is no premature withdrawal option, but senior citizens get the option to
prematurely withdraw money with a penalty after a minimum lock-in period.
• For those aged 60 to 70, the lock-in period will be six years.
• For those aged 70 to 80, the lock-in period will be five years.
• Those aged above 80 can withdraw their investment after four years from the date of
investment.
RBI consolidates credit information reports mandate
• Credit Information Companies (CICs)
• They collect public data, credit transactions and payment histories of individuals and
companies regarding loans, credit cards, among others.
• CICs are licensed by RBI and regulated by CIC Regulation Act, 2005
• At present, four credit information companies are given certificates of registration by
the RBI.
• Credit Information Bureau (India) Limited (CIBIL), Equifax Credit Information
Services Private Limited, Experian Credit Information Company of India Private
Limited and CRIF High Mark Credit Information Services Private Limited.
• News : Master Direction on Credit Information Reporting
• Published by : RBI
• Report Highlight : CICs s will have to send alerts through SMS/email to customers
when their credit information report is accessed by the specified users.
• Report also has made it mandatory for credit institutions (CIs), such as banks and non-
banking financial companies, to provide reasons when rejecting data correction
requests from individuals.
RBI announces results of third edition of its Global Hackathon – HaRBInger 2024

• Hackathon : “HaRBInger – Innovation for Transformation”

• Edition : Third
 • Theme : ‘Zero Financial Frauds’ and ‘Being Divyang Friendly’ covering four problem
statements
Problem Statement Winner Solution Description
Real time prediction, FPL ‘OneRadar’ is a Human-in-the-loop enabled
detection and prevention Technologies FRM comprehensive solution with three
of frauds in financial Pvt. Ltd. components: a consumer app which uses
transactions using alternate visual colour coded screen for alerting
sources of data including customers and capturing their feedback, a
publicly available decision strategy model to process these
information. signals and an expert platform to review
feedback by humans and further enhance the
model. The solution aims to achieve high
level of fraud prevention while reducing false
positives and minimising latency.
Ensuring transaction Xaults The solution enables secure online
anonymity in token-based Technologies transactions with cash-like privacy,
(CBDC) transactions while Pvt. Ltd. safeguarding user identity and transaction
maintaining financial amounts within regulatory thresholds. The
system integrity. solution uses technologies like Stealth
Addresses and Zero-Knowledge Proofs to
ensure anonymity while seamlessly
integrating with existing CBDC
infrastructure. The solution aims to foster
CBDC adoption by enhancing user
confidence and ensuring privacy.
Identifying mule bank Epifi The solution ‘Satark’ creates a comprehensive
accounts / payment Technologies digital footprint for each account using
wallets.(Joint winners) Pvt. Ltd. financial and non-financial, profile, device
and other external information. It uses
multiple AI and analytical models to identify
suspicious mule accounts in real-time. It aims
to strengthen fraud defence and maintain
financial system integrity.
NapID The solution ‘Tager AI’ is a real-time,
Cybersec Pvt. interoperable AI/ML platform that uses Loop
Ltd. Tagging technology to track transactions,
prevent unauthorised withdrawals, and enable
seamless fraud detection. It detects mule
accounts and suspicious transactions across
multiple banks and secures funds within the
banking system for quick recovery.
 Accurately identifying H Vision India Pvt. The device is a smart wallet for visually
banknotes by visually Ltd. (Hasin Vaidya) impaired individuals that enables the
impaired.(Joint identification of currency notes by
winners) detecting various features such as the
paper's UV absorption rate, the ink's UV
fluorescence, and its colour.
Rupya The product ‘Rupya Darshini’ is an
Darshini(Parthiban R., ergonomically designed, wallet-sized
Jebaraj V. and Gobika tool that enables visually challenged
S.) individuals to identify Indian banknotes,
in both old and new series, by leveraging
variations in their geometric dimensions
and Braille markings through a simple
‘fold and find’ method.
Best ‘all women team’ VisAst(Krimisha The solution is a lightweight, wearable
(a team comprising of Deore) standalone device that can be attached to
only women members), the body and is designed to detect
across all the four currency notes and provide voice-based
problem statements. declarations. This AI/ML model-based
device can also be trained to perform
object detection tasks.

RBI’s Guidelines on Government Debt Relief Scheme

• Guidelines by: RBI
• Guidelines for: Government Debt Relief Scheme
• Aim: To assist borrowers facing financial difficulties by allowing loan restructuring.
• This includes extending repayment terms, lowering interest rates, or converting part of
the debt into equity.
• Key Components of the Scheme
• Eligibility Criteria: The scheme targets borrowers who have demonstrated a consistent
repayment history but are currently facing financial difficulties due to unforeseen
circumstances.
• Restructuring Framework: Lenders are permitted to restructure loans by extending
repayment periods, reducing interest rates, or converting a portion of the debt into
equity, subject to specific conditions.
• Regulatory Oversight: The RBI will monitor the implementation of the scheme to
ensure compliance with established guidelines and to maintain financial stability.
• Implications for Lenders and Borrowers
• For Lenders: The guidelines provide a structured approach to managing distressed
assets, enabling banks to offer relief to borrowers while safeguarding their financial
interests.
 • For Borrowers: The scheme offers a pathway to financial recovery, allowing businesses
and individuals to restructure their debts and continue operations without the immediate
threat of insolvency.
RBI's new 15-day credit reporting rule
• Organization: Reserve Bank of India (RBI)
• Mandate: All lenders must update credit bureau records every 15 days.
• Effective from: January 1, 2025
• Aim: To provide a more accurate and timely representation of borrowers' financial
activities, ultimately transforming how credit scores are calculated and published.
• Previously, the credit bureaus received updates from lenders only once a month.
• Benefits of the New Regulation
• Timely Updates
• Enhanced Credit Access
• Consumer Empowerment
• Risk Management for Lenders
RBI increased gold reserves by 8 tonnes in November 2024
• Report title: Central bank gold statistics November 2024
• Report by: World Gold Council (WGC) report
• Worldwide: Central banks around the world collectively have added 53 tonnes of gold
to their reserves.
• Gold added to reserve by RBI: 8 tonnes
• RBI has lifted the year-to-date buying to 73 tonnes and total gold holdings to 876
tonnes, maintaining its position as the second largest buyer in 2024, after Poland.
• The National Bank of Poland (NBP) was a major buyer in November 2024 increasing
its gold reserves by 21 tonnes in November, taking its total year-to-date purchase to 90
tonnes and the total holding to 448 tonnes.
RBI removes Supervisory Restrictions on Asirvad Micro Finance Limited & DMI
Finance Private Limited
• The Reserve Bank of India lifted restrictions on Asirvad Micro Finance and DMI
Finance.
• These restrictions had been imposed in October 2024.
• Reason: Due to non-compliance with regulatory guidelines.
• The business restrictions that were imposed on two other NBFCs on Reserve Bank’s
orders dated October 17, 2024, viz. Navi Finserv Pvt Ltd and Arohan Financial Services
Limited have been lifted vide our orders dated December 2, 2024 and January 3, 2025,
respectively.
• The NBFC-MFI is a non-deposit taking financial company.
• Minimum Net Owned Funds (NOF) of Rs. 5 crore.
• An NBFC-ICC, or Non-Banking Financial Company - Investment and Credit
Company, is a financial institution that primarily deals with asset finance.
• Asset finance is a finance option that allows business to grow by acquiring much needed
equipment such as plant machinery, vehicles, aircrafts and more
SEBI Eases Settlement Norms for Inactive Brokerage Accounts
• Under the updated norms, brokerage accounts deemed inactive—those with no trades
for 30 calendar days—will now have their funds returned on the next scheduled
monthly settlement date.
• This change applies irrespective of whether clients opt for monthly or quarterly
settlement cycles.
• Previously, brokers were required to return funds within three working days of
identifying inactivity.
• However, the Brokers’ Industry Standards Forum (ISF) highlighted the operational
difficulties of adhering to this timeline, even though client funds remained securely held
by clearing corporations.
Sebi issues new guidelines for research analysts, investment advisers
• Guidelines on the regulatory framework for research analysts and investment advisers.
• Published by SEBI.
• Research analysts are required to maintain a deposit based on their client base, ranging
from Rs 1 lakh for up to 150 clients to Rs 10 lakh for over 1,000 clients.
• Existing IAs must comply with the deposit requirements by June 30, 2025.
• Similarly, all research analysts must meet the deposit requirements by April 30, 2025.
• SEBI In News
• RIAs can now cater to up to 300 clients before transitioning to corporate status, up from
the earlier cap of 150 clients.
• Part-Time RIAs should have a limit of 75 clients.
RBIH & IIMA Ventures Launch Swanari TechSprint 3.0
• Launch of: Swanari TechSprint 3.0
• Launched by: Reserve Bank Innovation Hub and IIMA Ventures
• Aim: To foster women-centric fintech startups in India.
• The programme provides a platform for fintech innovators to conceptualise, develop,
and scale solutions that address the unique financial needs of women.
• The Reserve Bank Innovation Hub (RBIH) is a wholly-owned subsidiary of the Reserve
Bank of India (RBI).
• HQ : Bengaluru
• It was established in 2022.
• In News
• IIM-K, RBIH sign pact to foster innovation, research in FinTech
• Reserve Bank Innovation Hub develops AI/ML model to tackle mule account fraud
• International Institute of Information Technology Bengaluru Innovation Centre (IIIT-B
IC) and the Reserve Bank Innovation Hub (RBIH) have signed a Memorandum of
Understanding (MoU) to foster innovation and growth in the Fintech sector.
• Unified Lending Interface has been based on Public Tech Platform for Frictionless
Credit (PTPFC) developed by RBIH.
KredX gets RBI nod to launch TReDS platform
 • KredX receives final approval from the Reserve Bank of India to commercially launch
its Trade Receivables Discounting System (TReDS) platform, DTX.
• With this approval, KredX became the fifth RBI-regulated TReDS platform in India.
• DTX aims to address payment delays and working capital gaps in the MSME sector,
promoting transparency, timely payments, and liquidity.
• The TReDS platform is a government-mandated initiative aimed at addressing the
challenge of delayed payments and working capital gaps in the micro, small, and
medium enterprise (MSME) sector
• Manish Kumar, CEO & Co-founder of KredX
• Trade Receivables electronic Discounting System (TReDS) is a digital platform that
serves as an easy transparent, auction-based factoring exchange for financing trade
receivable of MSMEs through multiple financiers.
• The RBI launched TReDS launched in 2018.
• Participants in TReDS Platform
• Sellers of goods and services: Micro, Small & Medium Suppliers (MSMEs)
• Buyers: Large companies, corporations or businesses that buy MSME goods and
services
• Financiers: Banks, and Non-Banking Financial Companies (NBFCs)
• RBI-regulated TReDS platform in India.
• Receivables Exchange of India Ltd (RXIL)
• M1xchange
• Invoicemart:
FAQs on the circular on 'Reset of Floating Interest Rate on Equated Monthly Instalments
(EMI) based Personal Loans'
• Summary :
• Lenders are required to offer fixed interest rate options for all personal loan categories
such as home loan, car loan etc. and allow borrowers to switch between floating and
fixed rates, with flexibility subject to board-approved policies and charges.
• Application By Borrower :
• When the RBI hikes the repo rate, then the borrower can switch from floating to fixed
interest rate to save on interest costs by paying certain charges.
• Similarly, when RBI cuts repo rate, then also borrower has option to switch from fixed
to floating interest rate regime to save on interest costs.
• Application By Lender :
• The bank can specify the number of times a borrower will be allowed to exercise the
switch option
• At sanction, lenders must disclose the annualized rate of interest in the Key Fact
Statement (KFS).
Penalties surge as RBI cracks the whip on lenders
• Data by: Reserve Bank of India
• Published in: Trend and Progress of Banking in India 2023-24
• Highlights:
• The total penalties paid by public sector banks increased six times to ₹24 crore in FY24.
 • Private sector banks paid: ₹25 crore in FY24 (up two times from ₹12 crore paid in
FY23)
• So far this fiscal up to November 2024, the RBI has imposed monetary penalty on 169
regulated entities with an aggregate penalty of ₹34 crore for non-compliance
with/contravention of statutory provisions or directions issued by the RBI.
Sebi proposes to double FPI disclosure threshold to Rs 50,000 crore
• Proposal by: SEBI
• Proposal:
• Increase in the investment threshold for granular disclosures by foreign portfolio
investors (FPIs).
• Present threshold: Rs 25,000 crore
• Proposed threshold: Rs 50,000 crore
• Reason of this move: Substantial rise in daily market turnover
• Existing framework:
• FPIs holding more than 50% of their Indian equity assets under management (AUM) in
a single Indian corporate group or exceeding Rs 25,000 crore in Indian equity AUM are
required to provide detailed disclosures of their holdings.
SEBI renews recognition to AMC Repo Clearing for 1 year to clear transactions
• Context: SEBI has renewed its recognition of AMC Repo Clearing Ltd as a clearing
corporation
• Reason: For clearing and settling transactions in repo and reverse repo in debt
securities.
• Validity: 1-year
• Till: January 16, 2026
• Under the rules, AMC Repo Clearing Ltd will not undertake any activity except that of
clearing and settling of transactions in repo and reverse repo in the debt securities that
are dealt with or traded on a recognised stock exchange.
Sebi modifies credit rating agency rules to enhance ease of doing business
• Context: Revised timelines for credit rating agencies (CRAs)
• Notified by: SEBI
• Reason: To enhance the ease of doing business
• Previous timeline: "days" for compliance deadlines
• Revised timeline: "working days" for compliance deadlines
• Under the revised rules, credit rating agencies are required to publish press releases on
rating actions within seven working days of the relevant event, replacing the previous
mandate of seven calendar days.
• Similarly, for reviewing ratings in cases of delays in debt servicing, the timeline has
been adjusted to two working days from two calendar days.
• Aim: To standardise rating processes and publication protocols.
• These changes follow recommendations from a working group on CRAs that
highlighted the challenges posed by existing timelines, especially during non-working
days.
Portfolios of Deputy Governors Assigned

Reserve Bank of India issues Non-resident Investment in Debt Instruments Directions

• Context: To regulate non-resident investment in debt instruments in India
• Direction issued by: RBI
• Exercise of the powers: Under section 6, read with section 47 of the Foreign Exchange
Management Act, 1999
• AD Category-I banks may bring the contents of the Master Direction to the notice of
their constituents.
• AD Category-1 banks:
• They also known as Authorised Dealer Category-1 banks, are banks that are authorized
by the Reserve Bank of India (RBI) to buy and sell foreign exchange.
• They offer a variety of services related to foreign exchange, including: Buying and
selling foreign currencies, Remitting funds abroad, and Obtaining letters of credit and
bank guarantees.
RBI to conduct daily VRR auctions from Friday to infuse liquidity
• The Reserve Bank of India (RBI) has announced that it will conduct daily variable rate
repo (VRR) auctions on all working days in Mumbai, until further notice.
• Aim: To ease the current liquidity tightness in the banking system.
• It will begin with a notified amount of Rs 50,000 crore.
• According to the revised liquidity framework announced on February 6, 2020, the 14-
day VRR/reverse repo auction was termed the main liquidity operation, while overnight
and up to 13-day auctions were termed ‘fine-tuning’ operations.
• VRR : It is a mechanism where the RBI permits banks to borrow funds at rates
determined by the market, differing from the fixed Repo Rate at which banks borrow
directly from the RBI.
• Typically lasting up to 14 days, VRR serves as a means to inject short-term liquidity
into the banking system. Conversely, Variable Rate Reverse Repo (VRRR) is employed
to absorb surplus liquidity from the system.
Sebi proposes mandatory demat issuance for securities
• Securities and Exchange Board of India (SEBI) has proposed mandating listed
companies to issue securities only in demat form following the stock split, consolidation
of the face value of shares, and merger or demerger.
• The new proposal aligns with its constant endeavour to encourage demat holding of
securities.
• If an investor does not have a demat account, the issuer companies will be required to
open a separate demat account with a suitable ledger of ownership or a suspense escrow
account for dealing with such securities.
RBI releases NBFC upper layer list for year 2024-25
 • The Reserve Bank of India (RBI) released the list of non-banking finance companies
(NBFCs) in the upper layer segment for the year 2024-25, which included Tata Sons
Private Ltd, Bajaj Finance Ltd, LIC Housing Finance Ltd and Aditya Birla Finance Ltd.
• Tata Sons continues to be in the NBFC upper layer (UL) list despite its proposal to
deregister as a non-banking finance company.
• Once an NBFC is classified as NBFC-UL, it is subjected to enhanced regulatory
requirement, at least for a period of 5 years
• Registration: under Companies Act, 1956.
• Different from banks, as they cannot accept demand deposits (accepts only term
deposits), are not part of payment & settlement system, and cannot issue cheques drawn
on themselves.
• Deposit insurance facility is not available to depositors of NBFCs.

RBI revises FEMA guidelines to boost cross-border transactions in rupee and local
currencies
• A review of existing regulations issued under Foreign Exchange Management Act
(FEMA), 1999 has been undertaken by RBI for promoting cross border transactions in
Indian Rupee (Internationalization of Rupee).
• People residing outside of India will be able to
• Open INR accounts in overseas branches of Authorized Dealer banks for settling all
permissible current and capital account transactions with a person resident in India.
• Indian exporters will be able to open accounts in any foreign currency overseas for
settlement of trade transactions, including receiving export proceeds and using these
proceeds to pay for imports.
• Internationalization of Rupee
• Internationalization is a process that involves increasing the use of the rupee in cross-
border transactions.
• It involves promoting rupee for import and export trade and then other current account
transactions, followed by its use in capital account transactions .
Daily Variable Rate Repo (VRR) Auction

• VRR
• It is a mechanism where the RBI permits banks to borrow funds at rates determined by
the market, differing from the fixed Repo Rate at which banks borrow directly from the
RBI.
• Typically lasting up to 14 days, VRR serves as a means to inject short-term liquidity
into the banking system.

Sebi, NISM launch eLearning course on municipal bonds

 • Markets regulator Sebi launched an eLearning course on municipal bonds.
• Aim: To equip officials of municipal corporations and urban local bodies with the
knowledge and practical skills to leverage such bonds as a tool for financing
development projects.
• The course has been conceptualised and designed by Sebi in collaboration with
National Institute of Securities Markets (NISM).
• Municipal bonds or muni bonds are referred as debt securities issued by urban local
government and agencies to fund day-to-day obligations and to fund finance capital
projects like highways, roads and schools.
• SEBI in News
• Sebi proposes mandatory dematerialisation of securities in case of stock split,
consolidation
• It will ammend the LODR Regulations, 2015
• Listing Obligations and Disclosure Requirements Regulations 2015
• SEBI has ordered research analysts are required to maintain a deposit based on their
client base, ranging from Rs 1 lakh for up to 150 clients to Rs 10 lakh for over 1,000
clients.
• SEBI relaxes norms for settling client accounts inactive for 30 Calendar Days.
SEBI to ease norms for Social Stock Exchanges
• Context : Securities and Exchange Board of India (SEBI) has proposed a new
framework for Social Stock Exchanges with changes in the definition of Not-for-Profit
(NPO) organisation and expansion of eligible activities to be identified as social
enterprise.
• Expanding definition of NPOs
• Social enterprise registered under a charitable trust registered under Indian Trusts Act,
1882 or under the public trust statute of the relevant State.
• Charitable society registered under Societies Registration Act, 1860.
• Company incorporated under Section 8 of Companies Act, 2013.
• Expanded definition includes:
• Trusts registered under Indian Registration Act with relevant sub registrar.
• Charitable society registered under the society registration statute of the relevant State.
• Companies registered under Section 25 of the Companies Act, 1956.
• Expanding Eligible list of activities
• welfare of disadvantaged children, women, destitute, elderly and disabled;
• vocational skills
• promotion and education of art, culture and heritage.
• Easing conditions for renewal of registration
• Now, NPOs shall be permitted to register with SSEs for two years without raising funds
through SSEs.
• Social Stock Exchange (SSE) is a separate segment of the existing Stock Exchange that
can help Social Enterprises to raise funds from the public through the stock exchange
mechanism.
• The primary goal of an SSE is to channel funds towards entities that create measurable
social impact.
 • Objectives:
• Regulated platform that connects social enterprises and potential donors.
• Facilitate funding for the growth of social enterprises.
• The SSE allows investors to subscribe to zero-coupon, zero-principal (ZCZP) bonds
issued by NPOs, thereby enabling donations for various activities undertaken by these
organisations.
• The first listing on the SSE took place in December 2023.
• Sebi has further proposed revisions to disclosure requirements, impact reporting, and
target activities to enhance transparency and accountability.
RBI releases ‘Financial Stability Report, December 2024’ (OLD)
REVISION
• It is a half-yearly publication, with contributions from all financial sector regulators.
• It presents the collective assessment of the Financial Stability and Development
Council subcommittee on current and emerging risks to the stability of the Indian
financial system.
• Gross domestic product (GDP) is projected to grow at 6.6 % in 2024-25
• debt-to-GDP ratio is expected to decrease from its pandemic peak of 62.7% (2020-21)
to 56.8% by 2024-25.
• The gross non-performing assets (NPAs) ratio of Indian banks has declined to a 12-year
low of 2.6% as of September 2024.
Sebi proposes launch of Rs 250 Sachet SIPs by mutual funds
• Sebi has proposed a small ticket systematic investment plan (SIP) of ₹ 250 to promote
financial inclusion and systematic savings among new investors to mutual funds.
• Each investor can make three discounted SIPs, committing for five years, with no
premature withdrawal restrictions.
• Only growth options are available under certain schemes.
• Such investments can only be made through the national automated clearing house and
unified payment interface.
• Sebi proposes mandatory dematerialisation of securities in case of stock split,
consolidation
• Sebi to start pre-listing trading in IPO to curb grey market activity
Sebi plans pre-listing trading for IPOs
• SEBI is planning to introduce a “when-listed” platform, which will allow trading
companies’ shares in a period between allotment of shares post the closure of the initial
public offering.
• The platform aims to reduce ‘grey market activity’ in companies’ stocks.
• grey market refers to the unofficial trading of securities even before being listed on
stock exchanges
• The grey market is a cash market and there is no delivery of shares.
• Many retail investors also look at the premium offered in the grey market on shares of
a company which has launched an IPO, before considering investing in the offer.
 • Currently, shares are allotted at T+3 (trading plus three working days) from closure of
the issue to listing.
• In those three days there is a lot of “kerb trading” (grey market trading).
• T is the day when an IPO closes for subscription while kerb trading refers to trading
outside the ambit of stock exchanges post official market hours
• At present, once the bidding process for an IPO closes, shares have to be listed on
bourses in trading plus three (T+3) working days.
• The allotment of shares has to be done on T+1 day.
RBI releases Annual Report of Ombudsman Scheme, 2023-24

• Report Duration : April 1, 2023 to March 31, 2024

• Report focuses on complaints and activities across RBI Ombudsman Offices.
• No. of RBI Ombudsman Offices : 24
• Reserve Bank – Integrated Ombudsman Scheme (RB-IOS), 2021 was launched on
November 12, 2021.
• Total Complaints : 9,34,355 complaints.
• %increase in complaints : 32.81 per cent.
• No. of complaints resolved : 2,84,355 complaints.
• %disposal rate : 95.10 per cent.
• Out of the total complaints received at the ORBIOs, 88.77 per cent were received
through digital modes
• Toll Free No. : 14448
• Other developments
• States / UTs of Mizoram, Nagaland, Ladakh, Manipur, and Lakshadweep were the
lowest contributors.
• Share of the top five categories, consisting of complaints received for (i) loans and
advances, (ii) mobile/ electronic banking, (iii) deposit accounts, (iv) credit cards and
(v) ATM / Debit cards was 87.24 per cent
RBI imposes monetary penalty on Canara Bank, Bank of India, J&K Bank
 • J&K Bank has been penalised ₹3.31 crore for contravening certain norms related to
financial inclusion: ‘Access to banking Services—Basic Savings Bank Deposit
Account (BSBDA)’, ‘Know Your Customer’, and ‘Loans and Advances—Statutory and
Other Restrictions’.
• Monetary penalty worth ₹1 crore was imposed on the public sector bank (PSB) Bank
of India for non-compliance with certain provisions of the Banking Regulation Act of
1949.
• Also, the PSB Canara Bank was penalized ₹1.63 crore for non-compliance with certain
directions on priority sector lending, the interest rate on deposits, and financial
inclusion—access to banking services—BSBDA.

Sebi launches digital knowledge repository Dharohar on Republic Day

• On Republic Day, Sebi launched a digital knowledge repository called 'Dharohar -
Milestones in the Indian securities market'.
• It showcases the history and evolution of the Indian securities market using an
interactive website with significant events, 3D galleries, and over 3,000 assets including
articles, interviews and videos.
• Dharohar has been designed to document and showcase this rich heritage and evolution
of the Indian securities market.
• The repository, Dharohar, can be accessed at www.mism.org.
RBI plans Rs 1.1 lakh crore liquidity infusion in banking system
• The Reserve Bank of India (RBI) has announced a plan to inject an additional Rs 1.1
lakh crore into the banking system.
• Route: Various measures including open market purchase auctions of Government
securities and a variable rate repo auction.
• Additionally, a $5 billion dollar-rupee swap auction will be conducted to enhance
liquidity.
• This decision follows a review of current liquidity and financial conditions.
• The open market operations will involve the purchase of Government of India securities
worth Rs 60,000 crore in three tranches of Rs 20,000 crore each.
• These tranches are scheduled for January 30, February 13, and February 20, 2025.
• A 56-day Variable Rate Repo auction for Rs 50,000 crore will take place on February
7, while the dollar-rupee swap auction of USD 5 billion for a tenor of six months will
be held on January 31.
RBI cancels registration of Mumbai-based X10 Financial Services
• The Reserve Bank of India canceled the registration of X10 Financial Services Ltd, an
NBFC, due to irregularities in its digital lending operations.
• The company outsourced key functions like credit appraisal and customer verification
to service providers without due diligence, violating outsourcing guidelines.

• Reserve Bank of India imposes monetary penalty on Datson Exports Limited, West
Bengal
• A penalty of Rs 1 lakh has been imposed on Datson Exports, West Bengal for non-
compliance with certain directions issued by the RBI on Managing Risks and Code of
Conduct in Outsourcing of Financial Services by NBFCs'
RBI publishes Payment System Report for Dec 2024
• Retail digital payments have surged from 162 crore transactions in 2013 to over 16,416
crore transactions in 2024, marking a nearly 100-fold increase over the past 12 years
• According to the latest payments system report by the Reserve Bank.
• This growth can largely be attributed to the success of UPI, which now accounts for
83% of total digital payments in 2024, up from 34% in 2019.
• In 2024 alone, the country saw as much as 208.5 billion digital payment transactions.
• On the other hand, the share of other digital payment methods, such as national
electronic funds transfer (NEFT), real-time gross settlement (RTGS), immediate
payment service (IMPS), and credit and debit cards, declined from 66% in 2019 to 17%
at the end of 2024.
• In the past five years alone, digital payments have increased 6.7 times in volume and
1.6 times in value.
• Digital payment transactions: In 2013 there were 222 crore digital transactions valued
at Rs 772 lakh crore, it has increased 94 times in volume and more than 3.5 times in
value in CY-2024.
 • It is a bi-annual report which analyses the trends in payment transactions carried out
using different payment systems in the last 5 calendar years (CY) up to CY-2024.
• Regulation of Payment Systems in India
• Payments and Settlement Systems Act, 2007 (PSS Act)
• Board for Regulation and Supervision of Payment and Settlement Systems (BPSS)
India's forex reserves decline by $1.88 billionn to $623.983 billion
• India's forex reserves dropped by $1.88 billion to $623.983 billion in the week ended
January 17, 2025.
• This follows a steeper decline of $8.714 billion the previous week, bringing the reserves
down from $625.871 billion.
• The reserves had previously peaked at an all-time high of $704.885 billion in late
September.
• Foreign currency assets is the largest component of the reserves.
RBI – Digital Payments Index for September 2024

• Name of Index : Digital Payments Index

• Published since January 1, 2021.
• Base Year : March 2018
• It is published semi-annually in March and September
• March 2024 : 445.5
• September 2024 : 465.33
• Parameters of Digital Payments Index
• Payment enablers (25 per cent weightage in the index)
• Demand-side and supply-side payment infrastructure factors (10 per cent each)
• Payment performance (45 per cent)
• Consumer centricity (5 per cent)
 • RBI’s other Publications
• Consumer Confidence Survey (CCS - Quarterly)
• Inflation Expectations Survey of Households (IESH - Quarterly)
• Financial Stability Report (Half-Yearly)
RDCL receives Certificate of Registration to commence Operations, from RBI
• RMBS Development Company Limited (RDCL) has now received Certificate of
Registration (CoR) from Reserve Bank of India(RBI) to commence operations.
• National Housing Bank (NHB), a statutory body under the Government of India has set
up RMBS Development Company Limited (RDCL) as the single largest shareholder
and is supported by a strong mix of investor classes across Banks, HFC/ NBFC and
Insurance company.
• The paid-up Capital of the Company is ₹500 crore with its Registered Office at
Mumbai.
• The Company is expected to commence operations in March, 2025.
• The Company is envisioned to play the role of a commercially sustainable market
intermediary to facilitate the growth and development of Residential Mortgage-Backed
Securitisation (RMBS) market in the country
• A Residential Mortgage Backed Security (RMBS) pays investors based on payments
from many individual mortgages.
Reserve Bank of India supersedes board of Aviom India Housing Finance due to
governance concerns
• The Reserve Bank of India (RBI) has superseded the board of Aviom India Housing
Finance due to governance concerns and defaults in meeting payment obligations.
• The central bank will start a resolution process of the housing finance company under
the Insolvency and Bankruptcy rules.
• Ram Kumar, the former chief general manager of state-run Punjab National Bank, has
been appointed as the administrator for the housing finance company.
RBI tightens norms for imposing penalty under payment systems law
• Basic Summary :
• RBI has tightened regulations under the Payment and Settlement Systems Act to ensure
compliance and enforcement actions.
• The revised framework allows for imposing higher penalties of up to Rs 10 lakh for
contraventions and compounding offences, with additional fines for ongoing defaults.
• Name of Act : Payment and Settlement Systems Act (PSS Act), 2007
• Reserve Bank is empowered to impose a penalty not exceeding Rs 10 lakh or twice the
amount involved in such contravention or default
• Earlier, the RBI was empowered to impose a penalty not exceeding Rs 5 lakh.
• The amount was raised following the enactment of the Jan Vishwas (Amendment of
Provisions) Act, 2023, which came into force on January 22, 2024.
• If the violation continues even after the penalty : a further penalty of up to Rs 25,000
for every day after the first will be imposed