part # Flashcards
the Bank is obligated to issue currency notes or bank notes in exchange for coins that are legal tender as per the
Coinage Act, 2011.
The rates of exchange and conditions under which these Foreign Exchange transactions occur are set by the Central Government. These rates are influenced by India’s obligations to
the International Monetary Fund (IMF).
Each scheduled bank is required to submit a return to the RBI, signed by
responsible officers
Frequency of CRR returns
Bi-weekly, on each alternate Friday. Must be sent within seven days after the reporting date.
If the reporting Friday is a public holiday, banks should report
the previous working day’s figures but relate it to that Friday.
For banks where submission is logistically challenging, a provisional return can be submitted within
seven days,
For banks where submission is logistically challenging, a provisional return can be submitted within seven days, followed by a final return within
twenty days of the reporting date.
For banks where submission is logistically challenging, such banks can submit a monthly return, due within
twenty days after the month ends, detailing the same information for the month’s close.
When banks must submit an additional special return.
If the last Friday of a month does not fall on an alternate Friday as per the regular reporting schedule
special return must be sent to the RBI within ________________ days from the date to which it relates.
seven
If a scheduled bank does not maintain the minimum average daily balance at the RBI as stipulated in sub-section (1) or (1A) during any fortnight, it is subject to penalties. First Fortnight Penalty:
The bank must pay penal interest at a rate of 3% above the bank rate on the shortfall amount for that particular fortnight.
If a scheduled bank does not maintain the minimum average daily balance at the RBI If the shortfall persists into the next fortnight, the rate of penal interest increases to
5% above the bank rate.
If a scheduled bank has already been subject to the higher penalty rate (5% above the bank rate) as per sub-section (3), and the average daily balance remains below the prescribed minimum in the next succeeding fortnight:
(a) Any director, manager, or secretary who is knowingly and willfully involved in this default can be fined up to 500 rupees, with an additional potential fine of up to 500 rupees for each subsequent fortnight of default. (b) The RBI can prohibit the bank from accepting any fresh deposits after the said fortnight.
If the bank continues to accept deposits in contravention of this prohibition, each director and officer involved, either through willful action or negligence, can be fined:
Up to 500 rupees for the initial default. An additional fine of up to 500 rupees for each subsequent day the contravening deposit is retained.
If a scheduled bank fails to comply with the reporting requirements outlined in subsection (2), it will be liable to pay a penalty of
100 rupees for each day the failure continues.
Penalties under subsections (3) and (4) for not maintaining CRR and not reporting CRR must be paid within __________________________ days after receiving a demand notice from the RBI.
14
The RBI can notify the inclusion of a bank in the Second Schedule if: (i) The bank has
paid-up capital and reserves totaling at least five lakh rupees.
Exclusion from the Second Schedule: In the opinion of the Bank after making an inspection under ________________________, conducting its affairs to the detriment of the interests of its depositors,
section 35 of the 4[Banking Regulation Act, 1949]
When deciding whether to include or exclude a State co-operative bank or a Regional Rural Bank from the Second Schedule, the RBI can rely on a certificate from the
National Bank (NABARD)
