In the backdrop of big corporates like Zee Entertainment Enterprises Ltd (ZEEL) coming under scrutiny for alleged governance lapses, the Centre is likely to review the related party clause of the Companies Act 2013 and may look at further strengthening it, a senior government official said. “The government will focus attention on the related party clause. It will see if there is a need to strengthen it. How do we strengthen the related party clause? This will engage the government's attention. All the big investigations have found the issue of related party transactions. Currently, the regime is lenient and disclosure-based,†the official told Moneycontrol. The official said that the recent investigations of ZEEL are likely to allegedly expose the issue of related party transactions.
The ministry of corporate affairs (MCA) has begun a comprehensive review of the rules and regulations, including the norms for accounting and auditing practices. According to Manoj Govil, secretary-MCA, extensive public consultations would be carried out for the review, which is aimed at making compliance easier, and making regulation more system-driven and effective.
Ease of Doing
Business for MSMEs: The Ministry of Corporate Affairs (MCA) is continuously
working towards driving transparency and strengthening the integrity of
financial reporting in the business. The notification pertaining to the new
audit trail rule is a step in this direction. This mandate is expected to be
implemented from April 1, 2022, for companies that are registered under the
Companies Acts in India. As per the notification “Every company which uses
accounting software for maintaining its books of account, shall use only such
accounting software which has a feature of recording audit trail of each and
every transaction, creating an edit log of each change made in books of account
along with the date when such changes were made and ensuring that the audit
trail cannot be disabled.â€
Feb 11, 2023
The
Reserve Bank on Friday updated its ‘Alert List’ for the public on unauthorised
forex trading platforms to include names of entities/platforms/ websites which
appear to be promoting such entities.
In September last year, the central bank came out with an ‘Alert List’
containing the names of 34 entities. The list now has 48 entries.”The Alert
List has been updated and includes names of entities/platforms/ websites which
appear to be promoting unauthorised entities/ETPs, including through
advertisements of such unauthorised entities or claiming to be providing
training/advisory services,” the RBI said, and added the Alert List is not
exhaustive.
Feb 09, 2023
In
a move that will help customers, the Reserve Bank of India (RBI) has proposed
to do away with the levy of “penal interest” on loan defaults by regulated
entities and replace it with “penal charges”. The central bank will issue draft
guidelines on the issue for comments from stakeholders soon.
In the bi-monthly ’Statement on Developmental and Regulatory Policies’ released
today (February 8), the RBI said that “divergent practices” by regulated
entities with regard to the levy of penal interest have led to customer
grievances and disputes have been seen.
Jan 10, 2023
The
Securities and Exchange Board of India (Sebi), in a circular issued on Monday,
clarified that all payment mechanisms provided by banks and payment aggregators
authorised by the Reserve Bank of India (RBI) to be used for settlement of
trades executed on the Request for Quote or RFQ platform.
This was in response to a clarification sought by stock exchanges and market
participants as to whether payment mechanisms other than ‘Real-Time Gross
Settlement’ or RTGS could be used for settlement.
Dec 05, 2022
The Reserve Bank of India
has announced the launch of the pilot project for retail digital rupee on
December 1, 2022, informed RBI in an official press release.
According to the release, users will be able to transact with e?-R through a
digital wallet offered by the participating banks and stored on mobile phones
and devices. The pilot would cover select locations in closed user groups (CUG)
comprising participating customers and merchants. “The e?-R would be in the
form of a digital token that represents legal tender. It would be issued in the
same denominations that paper currency and coins are currently issued. It would
be distributed through intermediaries, i.e., banks,” RBI noted.
Dec 06, 2022
While
the fiscal second quarter growth may be just half of what it was in the first
quarter, the central bank may not still put a brake on raising interest rates
as price pressures continue.
Economists have factored a lower growth for the September quarter at 6.5
percent compared to 13.5 percent in the June quarter. Despite risks of a
further slowdown, the Reserve Bank is still expected to deliver a 35 to 50
basis points ( one bps is 0.01 percent) rate hike to manage inflation within
the mandated band of 2-6 percent.
Dec 09, 2022
The
Reserve Bank of India has raised the minimum capital requirement for asset
reconstruction companies (ARC) and widened the scope of their activities by
allowing them to act as resolution applicants under the bankruptcy law
backpedaling from its previous defiance on the matter.
These are crucial parts in the revised set of rules for ARCs that the regulator
unveiled Tuesday with an aim to improve their regulatory framework and
strengthen their governance standard
Dec 09, 2022
The
Reserve Bank on Tuesday modified and consolidated guidelines for banks on
unhedged foreign currency exposures of any entity to prevent losses due to
heightened volatility in the forex market.The RBI has, from time to time,
issued several guidelines, instructions and directives to the banks on Unhedged
Foreign Currency Exposure (UFCE) of the entities, which have borrowed from
banks.
In the wake of a bank seeking clarification on various aspects related to UFCE,
the RBI said a comprehensive review of the extant guidelines has been
undertaken and all the existing instructions on the subject have been
consolidated.These instructions shall come into force from January 1, 2023, it
said in a circular.
Dec 14, 2022
In a move that may put
pressure on the capital adequacy of banks, the Reserve Bank of India (RBI) on
Monday said loan ratings without information about lenders’ details should be
treated as unrated exposure.
Capital should be set aside using risk weightings applicable for unrated
exposure to companies and non-banking finance
companies.
The RBI said these instructions would be effective on March 31, 2023. Thus, any
burden on account of higher capital charges will be in the current financial
year (FY23).
The press releases (PRs) issued by external credit assessment institutions
(ECAI) on ratings often do not have lenders’ details.
Sep 23, 2022
India Inc is bracing
itself for yet another policy rate hike by the RBI Monetary Policy Committee in
the range of 35-50 basis points as the move seems unavoidable in the wake of
the global monetary tightening to limit the impact of inflation, ASSOCHAM has
said. The chamber has sought a balanced and smooth transition to the new
trajectory for borrowing costs.
Seeking several measures for ensuring that adequate liquidity is maintained
within the system, the ASSOCHAM has said '' 35-50 bps rate hike seems imminent
and inevitable while the MPC may leave the CRR and SLR rates unchanged''.
ASSOCHAM president Mr Sumant Sinha said while 35-50 bps increase in the
benchmark rates seems unavoidable at this point of time given the continuous
monetary tightening by the US Federal Reserve and other central banks. He
however noted that economic activity is at robust levels. “India is in a sweet
spot with growth coming from all quarters and inflation is relatively in
control. Softening of crude prices will augur well for the economy and we
should start the interest rate cut cycle from early part of FY24.”
· Aug 30, 2022
The Reserve Bank of India
is looking forward to establishing a fraud registry to compile a database of
dubious websites, phones, and other digital fraud methods as part of its
attempts to increase client safety.
According to RBI executive director Anil Kumar Sharma, such a database will
assist to stop these fraudsters from committing the same fraud because the
websites or phone numbers will be blacklisted.
"There is no definite timeline for setting up of the fraud registry. At
present, we are talking to different stakeholders including different
departments like payments and settlement and supervision of RBI," Sharma
revealed.
Users in the payment system will have access to this registry for almost
real-time fraud monitoring. To inform clients about new hazards, the aggregated
fraud data will be made public.
Aug 12, 2022
RBI Digital Lending
Rules: The Reserve Bank of India (RBI) has issued strict guidelines for digital
lending in the country. Borrowers are set to benefit from the new RBI
guidelines directed at curbing rampant malpractices in the digital lending
ecosystem.
The RBI has issued the guidelines based on recommendations of a working group
for digital lending which submitted its report in November 2021. You can read
more details of the guidelines issued by the RBI here. In this article, we take
a look at what the borrowers should know before going for a loan in view of the
new lending norms issued by the RBI.
Legal experts say that borrowers should know the safeguards assured by the
RBI’s new regulatory framework for digital lending.
“These norms were required to protect the interest of the borrowers and to
ensure that the money cycle is taking place through legitimate apps with proper
KYC structure and audit mechanism as a lot number of fake applications are
being reported and the end user incur losses.
Dec 09, 2022
The
Reserve Bank on Tuesday modified and consolidated guidelines for banks on
unhedged foreign currency exposures of any entity to prevent losses due to
heightened volatility in the forex market.The RBI has, from time to time,
issued several guidelines, instructions and directives to the banks on Unhedged
Foreign Currency Exposure (UFCE) of the entities, which have borrowed from
banks.
In the wake of a bank seeking clarification on various aspects related to UFCE,
the RBI said a comprehensive review of the extant guidelines has been
undertaken and all the existing instructions on the subject have been
consolidated.These instructions shall come into force from January 1, 2023, it
said in a circular.
Dec 09, 2022
The
Reserve Bank on Tuesday modified and consolidated guidelines for banks on
unhedged foreign currency exposures of any entity to prevent losses due to
heightened volatility in the forex market.The RBI has, from time to time,
issued several guidelines, instructions and directives to the banks on Unhedged
Foreign Currency Exposure (UFCE) of the entities, which have borrowed from
banks.
In the wake of a bank seeking clarification on various aspects related to UFCE,
the RBI said a comprehensive review of the extant guidelines has been
undertaken and all the existing instructions on the subject have been
consolidated.These instructions shall come into force from January 1, 2023, it
said in a circular.
· Dec 14, 2022
In a move that may put
pressure on the capital adequacy of banks, the Reserve Bank of India (RBI) on
Monday said loan ratings without information about lenders’ details should be
treated as unrated exposure.
Capital should be set aside using risk weightings applicable for unrated
exposure to companies and non-banking finance
companies.
The RBI said these instructions would be effective on March 31, 2023. Thus, any
burden on account of higher capital charges will be in the current financial
year (FY23).
The press releases (PRs) issued by external credit assessment institutions
(ECAI) on ratings often do not have lenders’ details.
Sep 23, 2022
India Inc is bracing
itself for yet another policy rate hike by the RBI Monetary Policy Committee in
the range of 35-50 basis points as the move seems unavoidable in the wake of
the global monetary tightening to limit the impact of inflation, ASSOCHAM has
said. The chamber has sought a balanced and smooth transition to the new
trajectory for borrowing costs.
Seeking several measures for ensuring that adequate liquidity is maintained
within the system, the ASSOCHAM has said '' 35-50 bps rate hike seems imminent
and inevitable while the MPC may leave the CRR and SLR rates unchanged''.
ASSOCHAM president Mr Sumant Sinha said while 35-50 bps increase in the
benchmark rates seems unavoidable at this point of time given the continuous
monetary tightening by the US Federal Reserve and other central banks. He
however noted that economic activity is at robust levels. “India is in a sweet
spot with growth coming from all quarters and inflation is relatively in
control. Softening of crude prices will augur well for the economy and we
should start the interest rate cut cycle from early part of FY24.”
Aug 30, 2022
The Reserve Bank of India
is looking forward to establishing a fraud registry to compile a database of
dubious websites, phones, and other digital fraud methods as part of its
attempts to increase client safety.
According to RBI executive director Anil Kumar Sharma, such a database will
assist to stop these fraudsters from committing the same fraud because the
websites or phone numbers will be blacklisted.
"There is no definite timeline for setting up of the fraud registry. At
present, we are talking to different stakeholders including different
departments like payments and settlement and supervision of RBI," Sharma
revealed.
Users in the payment system will have access to this registry for almost
real-time fraud monitoring. To inform clients about new hazards, the aggregated
fraud data will be made public.
Aug 12, 2022
RBI Digital Lending
Rules: The Reserve Bank of India (RBI) has issued strict guidelines for digital
lending in the country. Borrowers are set to benefit from the new RBI
guidelines directed at curbing rampant malpractices in the digital lending
ecosystem.
The RBI has issued the guidelines based on recommendations of a working group
for digital lending which submitted its report in November 2021. You can read
more details of the guidelines issued by the RBI here. In this article, we take
a look at what the borrowers should know before going for a loan in view of the
new lending norms issued by the RBI.
Legal experts say that borrowers should know the safeguards assured by the
RBI’s new regulatory framework for digital lending.
“These norms were required to protect the interest of the borrowers and to
ensure that the money cycle is taking place through legitimate apps with proper
KYC structure and audit mechanism as a lot number of fake applications are
being reported and the end user incur losses.
Jul 29, 2022
The
Reserve Bank of India (RBI) on Thursday released guidelines to ease the
transition to new norms on card-on-file (CoF) tokenisation and licensing of
payment aggregators (PAs) in two separate notifications.
While reiterating that with effect from October 1, no entity in the card
transaction chain, other than card issuers and card networks, shall store CoF
data, the central bank notified two interim measures. Other than the card
issuer and the card network, the merchant or its PA involved in settlement can
save the CoF data for a maximum period of four days after the transaction date
or till the settlement date, whichever is earlier. This data shall be used only
for settlement of such transactions, and must be purged thereafter, the RBI
said.
Jul 23, 2022
Reserve
Bank of India (RBI) Governor Shaktikanta Das on Friday said digital lending
players should only carry out activities for which they have licenses and
violations are not acceptable.
Last month, RBI had asked non-bank Prepaid Payment Instrument (PPI) issuers not
to load their wallets and cards from credit lines or preset borrowing limits.
“The (digital lending) firms should operate under the licenses granted to them.
If they are doing anything beyond that then they should seek our permission.
Jul 21, 2022
The
Reserve Bank of India is in the process of implementing the Central Bank Digital
Currency (CBDC) in a phased manner for the wholesale and retail segments, said
its executive director. The CBDC will be a sovereign-backed digital currency.
Passage of the Finance Bill 2022 has enabled RBI to conduct a pilot and
subsequent issuance of CBDC, Choudhary while delivering a keynote address at
'PICUP Fintech Conference & Awards' by industry association FICCI on
Wednesday.
Choudhary said RBI has fostered innovation and it is keeping a close eye on the
benefits and risks associated with innovative products and services offered by
fintechs. "The challenge for policymakers is to maximise the benefits of
fintech while minimising the potential risk," he said.
Jul 20, 2022
Products
offered by four entities for ‘cross border payments’ have been found viable by
the Reserve Bank of India (RBI) after they completed the test phase under the
regulatory sandbox scheme.
Regulatory sandbox usually refers to live testing of new products or services
in a controlled/test regulatory environment for which regulators may (or may
not) permit certain relaxations for the limited purpose of the testing.
Jul 07, 2022
The Reserve Bank of India
on Wednesday announced measures to diversify and expand the sources of forex
funding with an aim to mitigate volatility and dampen global spillovers,
including letting foreign investors invest in short-term corporate debt and
allowing the purchase of more government securities under the fully accessible
route.
The measures taken by the central bank come against the backdrop of the Rupee
depreciating by 4.1% against the US dollar during the current financial year so
far (up to July 5) amid the ongoing geopolitical tensions.
“The global outlook is clouded by recession risks. Consequently, high risk
aversion has gripped financial markets, producing surges of volatility,
sell-offs of risk assets and large spillovers, including flights to safety and
safe haven demand for the US dollar. As a result, emerging market economies are
facing retrenchment of portfolio flows and persistent downward pressures on
their currencies," the RBI said while announcing the new measures to boost
forex inflows.
Jun 14, 2022
RBI’s
Regulations Review Authority has suggested all regulations of the central bank
should underline the rationale and be reviewed periodically to align them with
evolving industry practices and financial landscape.
Regulations Review Authority (RRA 2.0) was set-up by the Reserve Bank of India
in April last year with the objective of reducing the compliance burden on
Regulated Entities (REs) by streamlining the regulatory instructions and rationalising
reporting requirements.
Jun 08, 2022
The Reserve Bank of India
(RBI) Governor on Wednesday announced that the Monetary Policy Committee voted
unanimously to hike the benchmark interest rate by 50 bps with immediate
effect. The RBI also left its FY23 GDP growth forecast unchanged at 7.2%.
The policy repo rate now stands at 4.90%, still below its pre-pandemic level.
Standing Deposit Facility (SDF) and Marginal Standing Facility (MSF) rates have
been raised by 50 bps. SDF rate stands adjusted to 4.65%, MSF rate adjusted to
5.15%.
On the inflation front, the RBI revised its projection to 6.7% from the earlier
estimate of 5.7% as the protracted nature of the Russia-Ukraine war puts
pressure on commodity prices globally.
10th January,2023
Newly incorporated Public Limited, Private Limited
and One Person Companies registered with effect from February 15, 2020
['Companies'] are being allotted ESIC registration number by default at the
time of its incorporation. Once these Companies are registered under Employee
State Insurance Act, 1948 ['ESI Act'] they will have to comply with the
provisions of ESI Act mandatorily as their registration becomes active
automatically on generation from the date of incorporation, irrespective of
whether these Companies fall under the ambit of the thresholds limits as
applicable[1]. However, it raised a new challenge before the Employee State
Insurance Corporation to identify whether these Companies fall under the
thresholds or not? To meet the above issue, Employee State Insurance
Corporation had released a Circular in this regard dated December 22, 2022
which states that Companies who have got default registration under ESI Act on
incorporation through MCA portal need not comply with the provisions of ESI Act
for a period of six months from the date of registration or until it exceeds
the thresholds as specified under ESI Act, whichever is earlier.
11th January, 2023
In the recent years, the Government of India has
liberlised its policies for the Foreign Investors whereby they can come to
India and invest in various sectors. Presently every sector except a few like
railway, defence, agriculture, real estate etc are allowed by the Government,
where Foreign Direct Investment can be made through automatic/ approval routes.
However, by making FDI, a Person Resident Outside India can only become the
shareholder, but theday to days affairs of the company shall lie with the Directors
only. So while making investment the investor would like to be part of the
Board of Directors of the company. Hence, the Ministry of Corporate Affairs
have enacted the various provisions under the Companies Act, 213 through which
Persons Resident Outside India can be allocated Directorship in Indian
Companies by complying with the Companies Act, 2013 (hereinafter referred as
"The Act") read along with the Companies (Appointment and
Qualifications of Directors) Rules, 2014 (hereinafter referred as "The
Rules")