A fee charged by a lender to a borrower for the unused/underutilized working capital limit and or undisbursed loan amount is known as commitment charge. A commitment fee is generally specified in the sanction endorsement of loans as a fixed percentage of fee payable by the borrower on the the undisbursed or unutilzed loan amount. Such…
RBI has announced Sovereign Gold Bond Scheme 2018-19– Series-I. The scheme is open for subscription from April 16, 2018 to April 20, 2018. The Bonds will be issued on the succeeding Monday after each subscription period. The Bonds will be sold through banks, Stock Holding Corporation of India Limited (SHCIL), designated post offices and recognised…
Bridge loan is a temporary short term loan taken by a person or company for a period ranging from 2-3 weeks to 52 weeks. Such loans are known as bridge loan because the loan helps in bridging the gap between short-term cash requirements and long-term loans or permanent source of funding. Bridge loans are also…
In terms of recommendations of Shri.D.K.Mohanty Committee on Currency Movement(CCM), RBI advised all the banks to consider using lockable cassettes in their ATMs which shall be swapped at the time of cash replenishment. The above decision was taken by the Central Bank in order to mitigate risks involved in open cash replenishment/top up. RBI…
All the AD category-I branches are now required to upload transaction-wise information (LRS data) of resident individuals to RBI on daily basis. According to RBI circular A.P. (DIR Series) Circular No. 23 dated April 12, 2018, all AD-I category branches are required to report remittances made under LRS scheme on a daily basis which…
Payment of Gratuity (Amendment) Act, 2018 is notified in the Government Gazette on 29th March 2018. The above amendment enables the employees to receive tax-free gratuity up to Rs 20 lakh from existing Rs 10 lakh under the Payment of Gratuity Act. According to the notification Payment of Gratuity (Amendment) Act, 2018 (12 of 2018),…
Hitherto, the persons resident in India and Foreign Portfolio Investors (FPIs) are allowed to take a long (bought) or short (sold) position in USD-INR upto USD 15 million per exchange without having to establish existence of underlying exposure. In addition, residents & FPIs are allowed to take long or short positions in EUR-INR, GBP-INR and…
(This post elucidates details of timelines for implementation of Resolution Plan (RP) and insolvency application to be filed by the lenders if a RP is not implemented as per the timeline.) In terms of RBI circular dated February 12, 2018, the ‘Resolution Plans’ (RP) under IBC shall be implemented within the timeline given below in…
The Reserve Bank of India on Monday (12.02.2018) scrapped all existing frameworks for revitalizing distressed assets such as Corporate Debt Restructuring (CDR) scheme , Flexible restructuring of long-term project loans(5/25) scheme, Strategic Debt Restructuring (SDR) scheme, Scheme for Sustainable Structuring of Stressed Assets(S4A). The Joint Lendes’ Foroum (JLF) as an institutional mechanism for resolution of…
The Reserve Bank of India on Febraury 7, 2018 vide its circular DBR.No.BP.BC.100/21.04.048/2017-18, given an instrucion to banks and NBFCs not to down grade the asset classification of accounts of MSME borrowers where the borrower’s account was standard as on August 31, 2017.The accounts shall be treated as standard accounts if the borrower unit is…