Page 10 - Banking Finance January 2022

RBI CORNER

lines and the amended version says, "It measures start unwinding, some of "The RRA has been engaging in exten-
has now been decided that henceforth these restructured accounts might sive consultations with both internal as
seized/confiscated gold will be sold face solvency issues over the coming well as external stakeholders, on re-
(other than gold ornaments/jewellery/ quarters. Prudence would warrant view of the regulatory and supervisory
articles) to RBI only. In this regard, the proactive recognition of such non-vi- instructions for their simplification and
Board has consulted RBI and Security able firms for pragmatic resolution ease of implementation.
Printing and Minting Corporation of measures," said Das.
"Based on these consultations and the
India Limited (SPMCIL) and also signed
suggestions of the Advisory Group, the
a tripartite Memorandum of Under- Reserve Bank panel rec- RRA has recommended withdrawal of
standing (MOU) with them."
ommends withdrawal of 150 circulars in the first tranche of rec-
Old guidelines prescribed gold in vari- ommendations," the RBI said.
ous forms such as bullion, jewellery, 150 circulars
ornament, seized/ confiscated by the The Reserve Bank withdrew more RBI for widening scope of
field formations of CBIC including the than 100 redundant circulars following
Directorate of Revenue Intelligence to recommendations made by the Regu- 'bank note' to include digi-
be sold to the Public Sector Banks and lations Review Authority. tal currency
other agencies.
The redundant circulars withdrawn The Reserve Bank of India (RBI) has
Under new guidelines, SPMCIL has relate to certain norms concerning proposed amendments to the Reserve
been engaged for collection, transpor- Foreign Investment in India by Foreign Bank of India Act, 1934, which would
tation, conversion into standard gold Portfolio Investors, RTGS, Know Your enable it to launch a Central Bank Digi-
bars and delivery to RBI. The SPMCIL Customer (KYC), and Anti-Money Laun- tal Currency (CBDC). The move comes
has facility to melt gold at India Gov- dering (AML)/Combating of Financing amid the government's plans to intro-
ernment Mints (IG Mint) located at
of Terrorism (CFT) Standards. duce a Bill on cryptocurrencies in the
Hyderabad, Kolkata and Mumbai. current Parliament session that seeks
The Regulations Review Authority
These mints will be carrying out pro- to prohibit "all private
(RRA 2.0) was set up by the Reserve
cesses such as pre-melting, assaying cryptocurrencies in India" with "cer-
and weighing in the presence of Cus- Bank of India (RBI) in April this year. tain exceptions".
toms Officer. The objective of the RRA 2.0 is to re-
view the regulatory instructions, re- "Government has received a proposal
Identify cos that are not move redundant and duplicate instruc- from Reserve Bank of India (RBI) in
October, 2021 for amendment to the
viable : RBI Chief tions, reduce the compliance burden Reserve Bank of India Act, 1934 to
on regulated entities by streamlining
RBI governor Shaktikanta Das asked reporting structure, revoking obsolete enhance the scope of the definition of
lenders to proactively identify loans to instructions and wherever possible ob- 'bank note' to include currency in digi-
firms that have turned non-viable but viating paper-based submission of re- tal form. RBI has been examining use
not yet recognised as a non-perform- turns. cases and working out a phased
ing asset (NPA) due to the special dis- implementation strategy for introduc-
pensation during Covid. The governor It was also envisaged that the RRA will tion of CBDC with little or no disrup-
also asked banks to review the usabil- engage internally as well as externally tion," Minister of State for Finance
ity of capital for absorbing losses dur- with all regulated entities and other Pankaj Chaudhary said in reply to a
ing a crisis. stakeholders to facilitate this process, query in Lok Sabha.
the RBI said.
Pointing out that numerous high-fre- The CBDC is a digital form of fiat cur-
quency indicators are showing that The RRA has also constituted an Advi- rency which can be transacted using
economic recovery is taking hold, Das sory Group representing the regulated wallets backed by blockchain and is
said that there have been several reso- entities under the chairmanship of regulated by the central bank. Though
lution frameworks announced in the Swaminathan J, Managing Director of the concept of CBDCs was directly in-
wake of the pandemic. "As the support State Bank of India. spired by bitcoin, it is different from

10 | 2022 | JANUARY | BANKING FINANCE