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*99# Service

NPCI launched *99# service, which works on Unstructured Supplementary Service Data (USSD) channel. This service was launched envisioning the potential of Mobile Banking and the need for immediate low value remittances which will help in financial deepening and inclusion of under banked society in the mainstream banking services.• *99# service was dedicated to the nation by Prime Minister of India Narendra Modi on 28th August 2014 as part of Pradhan Mantri Jan Dhan Yojana (PMJDY).• Banking customers can avail this service by dialing *99#, a “Common number across all Telecom Service Providers (TSPs)” on their mobile phone and transact through an interactive menu displayed on the mobile screen.• Key services offered under *99# service include, interbank account to account fund transfer, balance enquiry, mini statement besides host of other services.• This service offered by 43 leading banks & all GSM service providers and can be accessed in 12 different languages including Hindi & English.• Currently, following Financial (Fund Transfer (P2P), (P2A), (P2U)) and, Non-financial and Value Added Services (VAS) are offered through *99# service.(P2P- Person to Person ), (P2Account ), (P2U- Aadhaar Number(UID)). Financial ServicesSending Money using Mobile NoSending Money using UPI IDSending Money using Aadhaar No.Sending Money using Account No. + IFSCRequesting Money using UPI ID / Mobile No.Non-Financial ServicesAccount BalanceSet UPI PINChange UPI PINLast 5 transactionsValue Added Services(*99*99#)Aadhaar linking StatusPMJDY A/C Overdraft StatusFeatures of *99# Service Uses USSD as the access channel that works across all GSM handsets (smartphone or otherwise)making it reach the last mile userSupports menu-based applications that is easy to maneuver for the usersDoes not require data connectivity (works on signaling channel) that makes it high availability serviceRound the clock availability (works even on holidays)Accessible through a common code *99# across all GSM Operators and mobile handsetsAdditional channel for using BHIM app and key catalyst for financial inclusion#ARCHANA

SDR

Special Drawing Rights (SDR) is an international reserve asset, created by the International Monetary Fund (IMF) in 1969 tosupplement its member countries’ official reserves.However, it is a basket of currencies, but is not treated as a currency.Why was it created?When countries were to do imports and exports, they had to face restrictions in world trade and financial development. The two mainassets that were used internationally were gold and US Dollar. But they were found to be inadequate when the world started expandingand international trade grew. Then IMF decided to create a new international reserve asset.When SDRs are used?They are used by the member countries of IMF for their balance of payments settlements.Any country holding SDRs can use them to buy any other global currency like for their balance of payments settlements or forkeeping foreign exchange reserves, etc.When a country takes credit or loan from IMF, it is given in SDR and not in any particular currency.SDRs make taking loan from IMF easy than taking loan from any other country. For example: India takes loan from US, it will getloan in US Dollars and also it have to return loan amount in US Dollars. But if India takes loan from IMF; it can get loan in USDollars and return the equivalent amount in any other currency present in SDRs bucket.Some facts about SDR:Currently the SDR bucket contains four major currencies – U.S. Dollar, Euro, Pound Japanese Yen and Chinese RenminbiThe value of an SDR is determined by a weighted basket of major currencies.The composition of this basket of currencies is reviewed every five years wherein the weightage of currencies sometimes getaltered.SDRs can be exchanged for freely usable currencies i.e. the currencies which are widely used in the international transactions.SDR is neither a currency, nor any precious metal.The SDR interest rate is determined weekly on each Friday.According to the last SDR review in 2010, the use of the Chinese renminbi (RMB) in international payments has risensubstantially, and also China continues to meet the export criterion for SDR inclusion, so Chinese renminbi (RMB) which would be effective from october 1, 2016 also got added in SDRs basket.#FancyJ 

idioms and phrase

1.to make sure: to be sure, to ascertain (also: to make certain)Please make sure that you turn off the radio before you go out.Could you make certain of the time? I don’t want to miss that TV show.2.now and then: occasionally, sometimes (also: now and again, at times, from time to time, off and on, once in a while)Both now and then and once in a while can be preceded by the adjective every.Another idiom with the same meaning and form is every so often.I don’t see him very often, but (every) now and then we arrange to have lunch together.Gary gets a cold (every) once in a while even though he takes good care of himself.Every so often my brother and I get together for a camping trip.I like to sleep late in the morning from time to time.3.to get rid of: to eliminate, to remove; to discard, to throw awayJerry tried hard to get rid of the stain on his shirt, but he never succeeded.The stain was so bad that Jerry finally had to get rid of his shirt.4.every other (one): every second (one), alternate (ones)I play tennis with my father every other Saturday, so I usually play twice a month.There were twenty problems in the exercise, but the teacher told us only to doevery other one. Actually, doing ten problems wasdifficult enough.5.to go with: to match, to compare well in color to design; to date, to accompany (also:to go out with)For the first definition, adverbs such as well and poorly are often used.That striped shirt goes well with the gray pants, but the pants go poorly with those leather shoes.Eda went with Richard for about six months, but now she is going out with a new boyfriend. 6.first-rate: excellent, superbThe food served in that four-star restaurant is truly first-rate.The Beverly Hills Hotel provides first-rate service to its guests.7.to come from: to originate from This idiom is commonly used in discussion of one’s home town, state, or country.What country in South American does she come from? She comes from Peru.I just learned that he really comes from Florida, not Texas.Where did this package come from? The mail carrier brought it.8.to make good time: to travel a sufficient distance at a reasonable speedThe adjective excellent can also be used.On our last trip, it rained the entire time, so we didn’tmake good time.We made excellent time on our trip to Florida; it only took eighteen hours.9.to mix up: to stir or shake well; to confuse, to bewilderFor the second definition, the passive forms to be mixed up or to get mixed up are often used.You should mix up the ingredients well before you put them in the pan.The teacher’s poor explanation really mixed the students up.The students think it’s their fault that they are mixed up so often.10.to see about: to give attention or time to (also:to attend to, to see to)Who is going to see about getting us a larger room for the meeting?I’ll see to arranging music for the wedding of you attend to the entertainment.11.to make out: to do, to succeed, to progressCharlie didn’t make out very well on his final examinations. He may have to repeat one or more classes.How did Rachelle make out on her acting audition in Hollywood yesterday?12.by heart: by memorizingHe knows many passages form Shakespeare by heart.Do you know all the idioms you have studied in this bookby heart?#FancyJ

ELECTORAL BONDS

In order to cleanse the system of political funding in the country and in keeping with the government’s desire to move to a cashless economy, Union Finance Minister Arun Jaitley introduced the electoral bonds scheme. The scheme, announced during the 2017 Budget, aims to account the donations made to all major political parties. What is Electoral Bond?An electoral bond is designed to be a bearer instrument like a Promissory Note - in effect, it will be similar to a bank note that is payable to the bearer on demand and free of interest. It can be purchased by any citizen of India or a body incorporated in India.How to use Electoral Bonds?The bonds will be issued in multiples of Rs1,000, Rs10,000, Rs1 lakh, Rs10 lakh and Rs1 crore and will be available at specified branches of State Bank of India. They can be bought by the donor with a KYC-compliant account. Donors can donate the bonds to their party of choice which can then be cashed in via the party's verified account within 15 days.What are the other conditions?Every party that is registered under section 29A of the Representation of the Peoples Act, 1951 and has secured at least one per cent of the votes polled in the most recent Lok Sabha or State election will be allotted a verified account by the Election Commission of India. Electoral bond transactions can be made only via this account.The bonds will be available for purchase for a period of 10 days each in the beginning of every quarter, i.e. in January, April, July and October as specified by the Central Government. An additional period of 30 days shall be specified by the Central Government in the year of Lok Sabha elections.As per the Finance Minister, the electoral bonds will not bear the name of the donor.In essence, the donor and the party details will be available with the bank, but the political party might not be aware of who is the donor. The intention is to ensure that all the donations made to a party will be accounted for in the balance sheets without exposing the donor details to the public.#RAJKUMAR

Words List

precautionary (adjective) – preventive, safety, protective.pull away (phrasal verb) – take off, remove, withdraw.punch bowl (noun) – dish, basin, pan. (punch is a drink made by mixing wine, spirits and cocktails with water, fruit juices).get going (phrase) – begin, start, go ahead.take away the punch bowl just as the party gets going (phrase) – to reduce the stimulus that it has been giving the economy.portend (verb) – augur, foretell; indicate/signal. squeeze (verb) – force, extract, wrest.dot-plot (noun) – it is a statistical chart consisting of data points.inflation (noun) – increase of price level of goods & services & vice versa decrease of currency value.spill over (phrasal verb) – (of a bad situation) spread to other areas.amid (preposition) – in the middle of, among; during.adversely (adverb) – unfavourably, disadvantageously, badly.debt (noun) – liability, financial obligation, borrowed capital.flag (verb) – indicate, identify, point out/signal.prone to (adjective) – vulnerable to, liable to, susceptible.reminiscent (adjective) – similar to, comparable with, bearing comparison with.mortgage (noun) – a legal agreement in which you borrow money (like bonds (government or corporate)).steep (adjective) – sharp, sudden, rapid.sell-off (noun) – selling of something (commodity/share) which causes fall in price.hit by (verb) – affect badly.outflow (noun) – money/assets flowing out of (or leaving) a particular country’s economy.homeward (adjective) – going towards home.#FancyJ

RC

As the U.S. continues to raise benchmark rates, India should take precautionary steps The U.S. Federal Reserve continues to slowly pull away the punch bowl as the party gets going. This week the Fed raised its benchmark short-term interest rate by 25 basis points to 1.50-1.75%, the highest in a decade. While this is only the sixth rate increase since the financial crisis of 2008 — which pushed central banks to cut interest rates to historic lows — it portends further increases in global interest rates. Higher borrowing costs could squeeze both markets and the wider economy. If its dot-plot projections are considered, the Fed under its new Chairman Jerome Powell — who chaired the Federal Open Market Committee meeting for the first time on Wednesday — is expected to raise rates two more times in 2018. And with the American economy projected to grow at a fairly healthy clip amid quickening inflation, the increases in the Fed’s discount rate are expected to gather pace over the next two years. Now, as the Fed and other global central banks move towards normalising monetary policy, the impact on the wider credit markets is slowly beginning to show. This is particularly so in the case of the interbank lending market, which is directly influenced by central banks to affect interest rates across the board. The London Interbank Offered Rate, which is the rate at which international banks lend to each other and serves as a benchmark for lending rates, has risen for more than 30 consecutive sessions and is at its highest since the financial crisis. Its effect has spilled over into other markets, including the corporate debt market. Rising rates amid improving global economic growth could adversely affect the capacity of private firms to service their debt. This risk of default by private borrowers has been flagged by various organisations, including the International Monetary Fund last month. It is, after all, no secret that private corporations attracted by ultra-low interest rates had heavily loaded up on debt over the last decade. Some companies borrowed heavily from across the borders, thus making them prone to exchange rate risks as well. Any widespread default on debt today would be reminiscent of the 2004-2006 period when the Fed’s raising of rates to tackle inflation led to a mass default on U.S. mortgage debt. Global markets on Friday witnessed a steep sell-off that was immediately linked to President Donald Trump’s recent decision to impose new tariffs on China. Trade wars clearly have a negative impact on global growth and corporate earnings. But the wider sell-off, under way since February, can also be linked to rising interest rates which adversely affect asset prices. India, which could be hit by fund outflows as overseas investors look homeward to benefit from the rising rates, would do well to take precautionary steps.#FancyJ

Letter of Credit Vs Bank Guarantee

When someone trades inside or outside India, the sellers often require a guarantee that they will get the correct payment from the buyerin a stipulated time period. Letter of credit and bank guarantee are two such guarantees which a buyer can get issued from bank andgive to the sellerSo they both guarantee on your behalf that the payment will get received to seller and he can provide his services to buyer. Theyeliminate the risk for exporter or seller.Letter of CreditA letter of credit is a letter issued by bank which guarantees seller’s payment on time and in correct amount up to the time theservices will be delivered to the buyer.So, it ensures that the transaction of money will go as planned by the bank.Example: You purchase some material from a seller and that material is to come on continuous basis for a month, you can getissue a letter of credit from bank and give to the seller which will ensure that the seller will receive his payments on regular basis.So the seller will believe more on the letter of credit issued than you for the payments.It can be used when someone imports goods from another country. In this case also a letter of credit can be given to seller.Most of the time the seller himself asks for a letter of credit from the buyer.It eliminates the financial risk because payment is to come from a bank.Bank guaranteeBank guarantee also has the functions as are of letter of credit with a small distinction.Unlike in letter of credit, in a bank guarantee the payment is done onlywhen the buyer is not able to pay the required amount ofmoney to the seller.Example: Same example can be taken; you buy material or import something to country, you can give a bank guarantee letter toexporter that will say that if you do not provide the payment, then bank will provide that on your behalf.So the difference between the two is that if you give letter of credit to seller, that will ensure that bank will pay on your behalf up to theday the services are being provided to you by the seller and if you give bank guarantee to seller, that will ensure that bank will pay onyour behalf if you are not able to pay the amount.Banks can apply charges to issue both letter of credit and bank guarantee.#FancyJ

Types of Risks

Financial RiskFinancial Risk develops from the business transactions done by the Banks which is exposed to potential Loss.Market RiskMarket Risk is a type of risk in which losses in on- or off-balance sheet positions that arise from movement in market prices. Market risk is the most prominent for banks present in investment banking.Credit RiskCredit Risk is the potential that a bank borrower/counter party fails to meet the obligations on agreed terms. There is always scope for the borrower to default from his commitments for one or the other reason resulting in crystalisation of credit risk to the bank. Credit risk is inherent to the business of lending funds to the operations linked closely to market risk variablesInterest Rate RiskInterest Rate Risk is the type of risk arises due to fluctuation in interest rate. Changes in interest rate affect earnings, value of assets, liability off-balance sheet items and cash flow. Earnings side involves analyzing the impact of changes in interest rates on accrual or reported earnings in the near term.Liquidity riskThis kind of Risk arises due to inability of bank to meet its obligations when any asset may not be realized into cash. Also, we can say that, it is a mismatch of assets and liabilities. Liquidity is the ability to efficiently accommodate deposit as also reduction in liabilities and to fund the loan growth and possible funding of the off-balance sheet claims.Foreign Exchange RiskForex risk is the risk that a bank may suffer loss as a result of adverse exchange rate movement during a period in which it has an open position, either spot or forward or both in same foreign currency.Capital RiskThis type of risk arises where the capital comes under risk partially or the whole in some cases emergencies. Operational RiskThis risks arises due to failure of day to day activities, system or people. It includes both internal and external frauds like failures related to policies, laws, regulations, documentation or any technological risks. It is defined as any risk that is not categorized as market or credit risk, is the risk of loss arising from inadequate or failed internal processes, people and systems or from external events.#ARCHANA

RC and words list

The National Health Protection Mission requires a bold, holistic approach The NDA government’s scheme to provide health cover of ₹5 lakh per year to 10 crore poor and vulnerable families through the Ayushman Bharat-National Health Protection Mission has taken a step forward with the Union Cabinet approving the modalities of its implementation. Considering the small window, just over a year, available before the term of the present government ends, urgent action is needed to roll out such an ambitious scheme. For a start, the apex council that will steer the programme and the governing board to operationalise it in partnership with the States need to be set up. The States, which have a statutory responsibility for provision of health care, have to act quickly and form dedicated agencies to run the scheme. Since the NHPM represents the foundation for a universal health coverage system that should eventually cover all Indians, it needs to be given a sound legal basis, ideally through a separate law. This could be on the lines of legislation governing the rights to food and information. Such legislation would strengthen entitlement to care, which is vital to the scheme’s success. It will also enable much-needed regulatory control over pricing of hospital-based treatments. The initial norms set for availing benefits under the NHPM, which subsumes earlier health assurance schemes, appear to make the inclusion of vulnerable groups such as senior citizens, women and children contingent on families meeting other criteria, except in the case of Scheduled Caste and Scheduled Tribe households. The government should take the bold step of including these groups universally; the financial risk can be borne by the taxpayer. Universal health coverage is defined by the WHO as a state when “all people obtain the health services they need without suffering financial hardship when paying for them”. With its endorsement of the Sustainable Development Goals for 2030, India will have to constantly raise its ambition during the dozen years to the deadline. This underscores the importance of raising not just core budgetary spending every year, but paying attention to social determinants of health. Affordable housing, planned urban development, pollution control and road safety are some aspects vital for reducing the public health burden. Unfortunately, governments are paying little attention to these issues, as the quality of life erodes even with steady economic growth. In some of its early assessments on the road to universal health coverage, NITI Aayog advocated a State-specific approach rather than a grand national health system to expand access. But the NHPM has a national character, with States playing a crucial role in its implementation, and beneficiaries being able to port the service anywhere. It is a challenging task to make all this a reality, and the government will have to work hard to put it in place.Word List-1 (To improve Vocabulary) holistic (adjective) – wholesome, comprehensive, full/total.vulnerable (adjective) – weak, helpless, reliant.step forward (phrasal verb) – come forward, progress, push ahead.modality (noun) – a particular method or procedure.roll out (phrasal verb) – launch, introduce, organize/inaugurate.ambitious (adjective) – determined, purposeful; formidable.steer (verb) – guide, lead, direct.statutory (adjective) – legitimate, permissible, judicial/legal.provision (noun) – term, clause, requirement/condition.entitlement (noun) – rights, claim, prerogative/privilege.subsume (verb) – include, encompass, incorporate.contingent on (adjective) – dependent, hinging on, resting on.borne past participle of bear (verb) – sustain, support, shoulder.hardship (noun) – poverty, financial distress, privation/destitution.endorsement (noun) – approval, recommendation, championship/advocacy.underscore (verb) – call attention to, emphasize, highlight.budgetary (adjective) – relating to an estimate of spending/earning.pay attention (phrase) – listen/heed, attend, concentrate on.determinant (noun) – factor, issue, concern.erode (verb) – (gradually) deteriorate, destroy, spoil.advocate (verb) – recommend, advise, support.port (verb) – transfer, carry.in place (phrase) – establish, set up, inaugurate.#FancyJ

IPO

Initial public offering is the process by which a private company can go public by sale of its stocks to general public. It could be a new,young company or an old company which decides to be listed on a stock exchange and hence goes public.The company which offers its shares, known as an ‘issuer’, does so with the help of investment banks. After IPO, the company’s sharesare traded in an open market. When the shares trade freely in the open market, money passes between public investors.But Why Go PublicThe company which wants to raise its funds generally goes for an IPO. So it is simply a money making process. The money can beused in various ways, such as re-investing in the company’s infrastructure or expanding the business.A public company can always issue more stocks and they get better rates also when they issue debt.Role Of Bank In IPOA company going for an IPO needs an investment bank to serve a number of purposes.One of the primary roles of an investment bank is to serve as a sort of intermediary between corporations and investorsthrough initial public offerings (IPOs).They do the required asset management for large investment funds.The bank evaluates the company and determines a price at which to offer the stock shares.It also advises the company to whether go public or raise funds through any alternative means.It also advises the company for mergers and acquisitions and to evaluate the fair price of acquisitions.There can be more than one investment bank.Disadvantages Apart from the various advantages, there are some disadvantages too of going for an IPOThe cost associated with the process is the first factor.Private companies do not have to disclose their information to anyone, but being after IPO they will have to disclose certainbusiness and financial information which can prove helpful to their competitors.For the management, efficient attention and effort is required.There is also a risk that required funds will not be raised.There is also a loss of control over the company because of the addition of new shareholders.#FancyJ

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