The quantity of gold for which the investor pays is protected, since he receives the ongoing market price at the time of redemption/ premature redemption. The SGB offers a superior alternative to holding gold in physical form. The risks and costs of storage are eliminated. Investors are assured of the market value of gold at the time of maturity and periodical interest. SGB is free from issues like making charges and purity in the case of gold in jewellery form. The bonds are held in the books of the RBI or in demat form eliminating risk of loss of scrip etc.

Response: Resident Indians [Individuals, HUFs, Proprietorship & Partnership firms, Trusts including Mutual Funds/Exchange Traded Funds registered under SBI (Mutual Fund) Regulations, Companies, charitable institutions, Central Government, State Government or any other entity owned by Central Government or State Government].

A. For Debit to SNRR A/c (for onward credit domestically)

In case of receipt of Export proceeds by an Indian party by debit to SNRR account of the overseas buyer:

• As in case of any inward remittance received for export payment, the AD bank handling the export documents shall ensure compliance with all export related rules/regulation/ guidelines prescribed under FEMA.

• The AD bank maintaining SNRR account shall be responsible for performing due diligence of the overseas client and related FEMA compliances. Further, it shall, while transferring the funds to the AD bank of the Indian exporter (beneficiary’s bank), provide complete KYC details of the account holder (Name, address, country etc.), purpose of remittance, currency and amount of remittance, name and account number of the beneficiary etc. so as to enable the latter to close the entries in EDPMS with the respective remittance.

B. For Credit to SNRR A/c (received from a domestic account)

In case of payment for Imports by an Indian party by credit to the SNRR account of the overseas seller:

• As in case of any outward remittance sent for import payment, the AD bank handling import documents and remitting funds (Importer’s Bank) shall ensure compliance with all related import rules/regulations/guidelines prescribed under FEMA.

• It shall also communicate all details related to the importer as required by the AD bank maintaining the SNRR account of the overseas client.

C. Similarly, in case of ECB, Trade credits, foreign investments, etc., the designated AD bank maintaining the resident customer’s A/c will be responsible for ensuring compliance with FEMA provisions, including issuance of FIRC, wherever applicable, on the same lines as it would have done in case of money received in freely convertible currency through an inward remittance. Further, the banks involved in the transaction shall be responsible for sharing of the details of the transactions on similar lines as above.

As on date, 21 Ombudsman for Digital Transactions have been appointed with their offices located mostly in state capitals. The addresses and contact details of the offices of the Ombudsman for Digital Transactions is provided under Annex I of the Scheme.

Ans. Yes. Under this facility, a cardholder can withdraw cash up to ₹2,000 per transaction within an overall monthly limit of ₹10,000.

The Government Securities Act, 2006 (G S Act) is an Act to consolidate and amend the laws relating to Government securities and its management by the RBI and for matters connected therewith.

As the disincentive mechanism will be applicable from the FY succeeding the FY in which a borrower becomes a ‘specified borrower’, the disincentive mechanism will be applicable from April 1, 2017 for any borrowing from the banking system beyond the NPLL.

Response

No. In supersession of instructions contained in circular RPCD.RF.BC.54/07.38.01/2005-06 dated December 13, 2005 and RPCD.CO.No.RRB.BC.58/03.05.33(F)/2005-06 dated December 27, 2005 on No Frill accounts, banks have now been advised to offer a 'Basic Savings Bank Deposit Account' to all their customers vide RPCD.CO.RRB.RCB.BC.No.24/07.38.01/2012-13 dated August 22, 2012 which will offer minimum common facilities as stated therein. Banks are required to convert the existing 'no-frills' accounts’ into 'Basic Savings Bank Deposit Accounts'.

Since floating rate loans are subject to periodic resets, the tenor premium will be the appropriate premium for the residual period up to the next reset date.

Ans: Electronic Platforms that assist only banks, NBFCs and other regulated AIFIs to identify borrowers are not to be treated as P2P platforms. However, in cases where, apart from banks or NBFCs or AIFIs, other retail lenders use the platform for lending, the platform will have to register separately as an NBFC-P2P.

As on date, four NBFC Ombudsman have been appointed with their offices located at Chennai, Kolkata, New Delhi and Mumbai. The addresses, contact details and territorial jurisdiction of the Ombudsman is provided in the Annex I of the Scheme.

• Inflation component on principal will not be paid with interest but the same would be adjusted in the principal by multiplying principal with index ratio (IR). At the time of redemption, adjusted principal or the face, whichever is higher, would be paid.

• Interest rate will be provided protection against inflation by paying fixed coupon rate on the principal adjusted against inflation.

• An example of cash flows on IIBs is furnished below.

Example 1 (For illustration purpose)
Year	Period	Real Coupon	Inflation Index	Index Ratio	Inflation adjusted principal	Coupon Payments	Principal Repayment
I	II	III	IV	Vti=(IVti/IVt0)	VI=(FV*V)	VII=(VI*III)	VIII
0	28-May-13	1.50%	100	1.00	100.0
1	28-May-14	1.50%	106	1.06	106.0	1.59
2	28-May-15	1.50%	111.8	1.12	111.8	1.68
3	28-May-16	1.50%	117.4	1.17	117.4	1.76
4	28-May-17	1.50%	123.3	1.23	123.3	1.85
5	28-May-18	1.50%	128.2	1.28	128.2	1.92
6	28-May-19	1.50%	135	1.35	135.0	2.03
7	28-May-20	1.50%	138.5	1.39	138.5	2.08
8	28-May-21	1.50%	142.8	1.43	142.8	2.14
9	28-May-22	1.50%	150.3	1.50	150.3	2.25
10	28-May-23	1.50%	160.2	1.60	160.2	2.40	160.2
Example 2 (For illustration purpose)
0	28-May-13	1.50%	100.0	1.00	100	1.50
1	28-May-14	1.50%	106.0	1.06	106	1.59
2	28-May-15	1.50%	111.0	1.11	111	1.67
3	28-May-16	1.50%	104.0	1.04	104	1.56
4	28-May-17	1.50%	98.0	0.98	98	1.47
5	28-May-18	1.50%	99.0	0.99	99	1.49
6	28-May-19	1.50%	105.5	1.06	105.5	1.58
7	28-May-20	1.50%	110.2	1.10	110.2	1.65
8	28-May-21	1.50%	106.5	1.07	106.5	1.60
9	28-May-22	1.50%	104.2	1.04	104.2	1.56
10	28-May-23	1.50%	99.2	0.99	99.2	1.49	100

Bank’s lending to the Micro, Small and Medium enterprises as under is eligible to be reckoned for priority sector advances:

(i) The definition of MSMEs will be as per Government of India, Gazette Notification S.O. 2119 (E) dated June 26, 2020 read with circulars FIDD.MSME & NFS.BC.No.3/06.02.31/2020-21 dated July 2, 2020, FIDD.MSME & NFS. BC. No.4/06.02.31/2020-21 dated August 21, 2020, FIDD.MSME & NFS.BC.No.13/06.02.31/2021-22 dated July 07, 2021 and updated from time to time.

(ii) Further, such MSMEs should be engaged in the manufacture or production of goods, in any manner, pertaining to any industry specified in the First Schedule to the Industries (Development and Regulation) Act, 1951 or engaged in providing or rendering of any service or services. All bank loans to MSMEs conforming to the above guidelines qualify for classification under priority sector lending.

Detailed guidelines on lending to the Micro, Small and Medium enterprises are available in our Master Direction FIDD.MSME & NFS.12/06.02.31/2017-18 dated July 24, 2017. The instructions issued by RBI, to banks, on various matters are available on our website www.rbi.org.in.

An application can be any application, addressed to any department of RBI, through which members of the public can apply (except such applications for which specific instructions have been given regarding mode of submission, etc.)

ADF seeks to ensure submission of correct and consistent data from the banks straight from their systems to Reserve Bank without any manual intervention.

Answer: A Foreign Currency Account is an account held or maintained in currency other than the currency of India or Nepal or Bhutan.

To widen the access of foreign exchange facilities to residents and tourists while ensuring efficient customer service through competition.

Ans. Foreign exchange can be purchased from any authorised person, such as an AD Category-I bank and AD Category II. Full-Fledged Money Changers (FFMCs) are also permitted to release exchange for business and private visits.

RBI carries out the general banking business of the governments through its own offices and commercial banks, both public and private, appointed as its agents. Section 45 of the Reserve Bank of India Act, 1934, provides for appointment of scheduled commercial banks as agents at all places or at any place in India, for purposes that it may specify, “having regard to public interest, convenience of banking, banking development and such other factors which in its opinion are relevant in this regard”.

Reserve Bank of India maintains the Principal Accounts of Central as well as State Governments at its Central Accounts Section, Nagpur. It has put in place a well-structured arrangement for revenue collection as well as payments on behalf of Government across the country. A network comprising the Government Banking Divisions of RBI and branches of agency banks appointed under Section 45 of the RBI Act carry out the government transactions. At present all the public sector banks and select private sector banks act as RBI's agents. Only designated branches of agency banks can conduct government banking business.

Ans The EFT system presently covers all the branches of the 27 public sector banks and 55 scheduled commercial banks at the 15 centres (viz., Ahmedabad, Bangalore, Bhubneshwar, Kolkata, Chandigarh, Chennai, Guwahati, Hyderabad, Jaipur, Kanpur, Mumbai, Nagpur, New Delhi, Patna and Thiruvananthpuram). Funds transfer is possible from any branch of these banks at these centres to other branch of any bank at these centres both inter-city and intra-city.