.RBI extends deadline for issuance of new format cheques i.The RBI has once again extended the deadline for issuance of new format cheque till July-end. ii.It has asked the banks to issue new cheque books only under the new format and gave them time till July-end towithdraw the old format cheques. iii.All cheques currently withcustomers in the old format(non-Cheque Truncation System) will continue to be valid for another four months (the earlier deadline was March 31), the apex bank said. iv.The Reserve Bank also said the system of post dated cheques and payment via Equated Monthly Installment (EMI), in either the old or new format, will be banned from now wherever electronic debit facilities are available. v.All cheques issued by banks (including DDs/POs) with effect from the date of this circular shall necessarily conform to CTS-2010 standard, vi.The CTS-2010 eliminates the current practice of physically presenting a cheque to the payee bank, thereby substantially reducing the time for cheque clearance. 2.Cheque signature mismatch may lead to criminal proceedings: Supreme Court i.A person may face criminal proceedings if acheque issued by him gets dishonouredon the ground that his signature does not match the specimen signature available with the bank. ii.Just as dishonour of a cheque on the ground that the account has been closed is a dishonour falling in the first contingency referred to in Section 138 of Negotiable Instrument Act, so also dishonour on the ground that the signatures do not match or that the image is not found, which too implies that the specimen signaturesdo not match the signatureson the cheque would constitute a dishonour within the meaning of Section 138 of the Act, 3.SEBI enables two-way fungibility of IDRs i.The Securities and Exchange Board of India (SEBI) has issued detailed guidelines which will allow shareholders to convert their depository receipts into equity shares of the issuer company and vice-versa. ii.The issuer could provide exchangeabilityto IDR holders by converting IDRs into underlying shares; or converting IDRs into underlying shares and selling the underlying shares in the foreign market where the shares of the issuer are listed and providing the sale proceeds to the IDR holders. iii.Existing IDR issuers can follow the new framework, and have to provide the option of redemption/conversion within three months from the date of completing a year of listing. AboutIndian Depository Receipts (IDRs) IDRs are generally instruments denominated in rupees and allow overseas companies to raise funds from the Indian market. How this step would help India’s capital market? i.This move of allowing for two-way fungibility of IDRs will encourage greater foreign participation in the Indian capital market. ii.So far only the UK-based banking major Standard Chartered PLC was listed as an IDR. 4.India Bhutan Sign Currency Swap Agreement i.India and Bhutan have inked a currency swap agreement forup to $100 millionto promote economic co-operation b/w the two nations. ii.The pact was signed by the Reserve Bank of India and theRoyalMonetary Authority of Bhutan (RMAB). iii.It enables RMAB to make withdrawals of US dollar, euro or Indian rupee in multiple tranches up to a maximum of $100 million or its equivalent. NOTE: i.The agreement is in line with RBI announcement in May 2012 to offer swap facilities aggregating $2 billion, both in foreign currency and Indian rupee, to SAARC member nations — Afghanistan, Bangladesh, Bhutan, Maldives, Nepal, Pakistan and Sri Lanka. ii.This pact will provideemergency funding for SAARC member countriesto meet any balance of payments and liquidity crisis till longer term arrangements are made or if there is need for short-term liquidity due to market upheaval. iii.The arrangement would be for a 3-year period and would help bring financial stability in the region. 5.Direct Cash Transfer scheme from Govt: Aapka Paisa, Aapke Haath i.Government’s direct cash transfer programme- the Direct Benefit Transfer Scheme which began on January 1, 2013 which benefitted 11 lakh poor people throughout the country. Main Objective: i.As per Finance Minister, P.Chidambaram, it costs the government Rs 3 to transfer 1 rupee to the pockets of beneficiaries. The rest goes on administrative expenses, waste and corruption. Cash transfers will do away with mediators of all sorts, thus reducing corruption and administrative burdens. ii.No delay in transfer of money to beneficiaries iii.Eliminationof falsification and duplication with regard to subsidies iv.Beneficiaries can access it themselves or via banking correspondents who are being set up in all the areas v.At present, beneficiaries have to furnish various paperwork for availing benefit. vi.CTS has the potential to merge all paperwork, thus reducing red tape and improving efficiency
Posted on: Sun, 01 Dec 2013 12:34:54 +0000
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