Page 9 - Banking Finance April 2020

RBI CORNER

RESERVE BANK

NEWS
NEWS
NEWS
NEWS
NEWS

RBI announces additional RBI stated in a press release that the isting non-bank entities offering pay-
regulator has superseded the bank’s ment aggregation (PA) services shall
LTRO for up to Rs.1,00,000- board because of a serious deteriora- apply for authorisation on or before

cr at the policy repo rate tion in its financial position. A former June 30, 2021," RBI said.
Reserve Bank of India has recently chief financial officer of SBI has been
announced that additional Long Term the named by the RBI as the adminis- "Good to see that entities handling
Repo Operations (LTROs) for up to a trator of Yes Bank. funds of customers are only being pro-
total of Rs.1,00,000 crore at the policy posed to be regulated unlike the origi-
repo rate. The move comes at the “This has been done to quickly restore nal draft. Also, the net worth require-
backdrop of improving monetary trans- depositors’ confidence in the bank, in- ments are reduced and adequate time
cluding by putting in place a scheme provided of one year to comply," said
mission amid the COVID-19 crisis. RBI
will also conduct the first tranche of for reconstruction or amalgamation," Naveen Surya, Chairman, Fintech Con-
the 3-year LTRO for Rs.25,000 crore on it said. vergence Council, an industry body for
fintech companies.
18 March 2020 accordingly.
A top RBI official said, “We are work-
"The capital requirements are not too
ing on a plan and we will disclose it in
RBI will take the decision about addi- high, most of these things were imple-
tional tranches of the LTROs separately the next few days.” mented by banks we work with any-
depending on the further review of way, these guidelines make it more
evolving liquidity conditions. RBI added RBI reduces capital re- transparent, one additional thing here
that the operational guidelines for quirement for payment is that merchants will not be able to
LTROs as well as the clarifications is- store card details of customers," said
sued in regard to that will apply for the aggregators to 15 crore Harshil Mathur, Chief Executive Officer,
current LTRO. The capital requirements for payment
Razorpay.
aggregators have been reduced by the
RBI caps withdrawal from RBI to Rs 15 crore at the time of appli- Hinduja Group seeks RBI
cation for the licence from Rs 100
Yes Bank at Rs 50,000 crore. approval to raise stake to
The RBI takes Yes Bank under control 26% in IndusInd Bank to
and capped withdrawals at Rs. 50,000. The RBI in its final regulatory note
The regulator has further imposed re- stated that applicants are required to 26%
strictions on its operations till 3 April. have Rs. 15 crore of net worth that In order to raise their stake in IndusInd
A bailout plan has been implemented needs to be increased to Rs. 25 crore bank to 26%, the Hinduja Group has
for the bank. within three years of operations. "Ex- sought the central bank’s permission.

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