 The Asian Development Bank has projected Indian economy to contract by 4% in Fiscal Year 2021. Indian economy has been projected to contract, as businesses came to a standstill for more than two months due to the nationwide lockdown implemented to contain the COVID-19. The Asian Development Bank expects India’s economy to recover in Fiscal Year 2022 with growth rate of 5%, as economic activity will get to its normal state gradually. |
Airtel Payments Bank has launched ‘Suraksha Salary Account’ for Micro, Small and Medium Enterprises (MSME). India’s MSME sector has over 60 million units and accounts for 29 per cent of India’s GDP.
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About ‘Suraksha Salary Account’:
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 ICICI Bank has introduced an online overdraft(od) facility ‘Insta FlexiCash’ for its salary account customers. The end-to-end fully digital facility is often accessed with no documentation, using the Bank’s internet banking platform without visiting a bank branch. This facility is meant to guard ICICI Bank Salary Account customers against missing their Equated Monthly Instalments (EMIs) or cheque bounces thanks to insufficient funds by providing short-term instant credit. Customers can easily avail of this facility by initiating their application online. |
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Important Features of ‘Insta Flexicash’:
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 National Bank for Agriculture and Rural Development (NABARD) has extended a Special Liquidity Facility (SLF) of Rs 270 crore to Assam Gramin Vikash Bank. The Special Liquidity Facility of Rs 270 crore has been provided to support the agricultural activities of the farmers amid COVID-19 pandemic. This line of credit would enable the farmers in enhancing their crop production and hence this amount would prove to be a boon to the agriculture credit of the state at this difficult hour. Amid the COVID-19 pandemic, NABARD is facilitating a liquidity support of Rs 25,000 crore nationwide to Cooperative Banks, Regional Rural Banks and Micro Finance Institutions (MFIs) during 2020-21 in order to ensure continued flow of credit to farmers and hence enable them in carrying out their agricultural operations smoothly even during COVID-19 pandemic period. |
 “Summer Treats” campaign has been launched by the private sector HDFC Bank. The special campaign has been launched by the bank with the easing of the lockdown restrictions in order to provide offers to both merchants and, salaried and self-employed customers. Under the “Summer Treats” campaign, bank will offer no cost EMI and no down payment for large appliances. It will also offer discounts and cashbacks on select brands along with 50% extra reward points on online spend using credit cards. |
 The sovereign rating of India has been downgraded by the Moody’s Investors Service to “Baa3”. The rating has been lowered from “Baa2” to “Baa3” citing the challenges faced by India in implementing the policies in order to reduce the risks of a sustained period of low growth and deteriorating fiscal position. “Baa3” is the lowest investment grade that is just a notch above the junk status. Moody’s Investors Service has also expected contraction by 4% in the India’s real GDP in fiscal 2021, due to the shock from the coronavirus pandemic as well as the related lockdown measures taken by India to contain the COVID-19 pandemic. It has also expected the growth of 8.7% in fiscal 2022. |
 An Artificial Intelligence (AI) based chatbot “PAi” has been launched by the National Payment Corporation of India (NPCI). This chatbot has been rolled out to create awareness around NPCI’s products such as FASTag, RuPay, UPI, AePS on a real time basis, hence improving the digital financial inclusion in India. The chatbot “PAi” has been developed by Bengaluru based startup CoRover Private Limited. The AI virtual assistant “PAi” would have access to accurate information on products of NPCI and would be available round the clock to solve the queries of the customers in English and Hindi, via text or voice on the websites of NPCI, RuPay, and UPI Chalega. It would also be available to global RuPay Cardholders as well. PAi will give verified automated responses to the customer’s queries on all NPCI’s products. |
 Moody’s Investors Service stated that G-20 countries are expected to grow by 2.1% in 2020. Moody’s cuts 0.3 percentage points lower than its previous forecast, as the global spread of the coronavirus, is resulting in simultaneous supply and demand shocks. It cautioned that global recession risks have risen. The global credit rating agency is expecting these shocks to materially slow economic activity, particularly in the first half of this year (2020). The G-20 grouping includes advanced economies such as the US, Euro area, Japan, Germany, and the UK, and emerging economies such as China, India, Brazil, Russia, and Mexico. |
 The Central Government of India imposed temporary prohibition of the activity of the capital-starved Yes Bank and capped withdrawals at Rs. 50,000 per account after considering an application made by the Reserve Bank of India. The board of Yes Bank has been superseded with immediate effect by the Reserve Bank of India (RBI). The RBI also assured the depositors of the bank that their interest will be fully protected and there is no need to panic. Former SBI CFO Prashant Kumar has been appointed as administrator of Yes Bank. Yes Bank has been grappling with mounting bad loans. The latest development comes six months after the regulator did the same with the city-based cooperative lender PMC Bank after a large scam was unearthed. |
The depositors will be allowed to withdraw more than Rs. 50,000 under the following conditions:
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 According to Union Finance Minister Nirmala Sitharaman, the exercise of consolidation of 10 public sector banks (PSBs) into four is on course and the merger will come into effect from the new financial year 1st April 2020. The Union Cabinet has given a go-ahead for the merger proposal. The Central government has been in regular touch with these banks. Finance Minister stated that the merger of Public Sector Banks’ merger is on course and decisions have already been taken by the respective bank boards. In the biggest consolidation exercise in the banking sector, the union government in August 2019 had announced four major mergers of public sector banks, bringing down their total number to 12 from 27 in 2017. |
As per the plan, PSBs will be merged into:-
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| The Plan had been first publicly mooted in December 2018 when Central Bank of India (RBI) stated that India could create some global banking majors if the then ongoing mergers of some state-owned banks achieve the desired impact of creating stronger and well-capitalized lenders of international level. In 2019, Mumbai based Dena Bank and Bengaluru based Vijaya Bank were merged with Bank of Baroda. Prior to this, the central government had merged five associate banks of State Bank of India and Bharatiya Mahila Bank with the State Bank of India effective from 1st April 2017. |
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