To know the impact of COVID-19 on the banking system in terms of banking rates, new rules and financial policies.

1. IMPACT OF COVID-19 ON INDIAN
BANKING SYSTEM

2. DONE BY THE MEMBERS OF GROUP NO-4
NAME ROLL NO
ASMEET KAUR RAWAL B-71
SIMRAN KAUR SAINI B-74
SWARANGI MILIND SAWANT B-81
MANSI MADHUKAR JADHAV A-24
LIMESH TARAK CHAVAN A-11
SAMIKSHA ANIL SALUNKHE A-76
SILVYA BABU MAZHUVENCHERRY B-46
SHANTHI ARUMUGANAINAR B-89
DIVYA SHIVKUMAR SHARMA B-90
DIVYANSHU DILIP SHINDE B-95

3. BANK
A BANK IS A
FINANCIAL INSTITUTION
LICENSED TO RECEIVE DEPOSITS
AND ADVANCE LOANS.

4. TYPES OF BANK

5. FUNCTIONS OF COMMERCIAL BANK

7. SHAKTIKANTA DAS

8. RATES
TYPES OF RATES
• BASE RATE
• BANK RATE
• REPO RATE
• REVERSE REPO RATE
• MARGINAL STANDING FACILITY
• STATUTORY LIQUIDITY RATIO (SLR)
• CASH RESERVE RATIO(CRR)
• FOREIGN EXCHANGE RATE
• CALL RATE
• RATE OF INTEREST

9. BASE RATE
BASE RATE IS THE MINIMUM RATE SET BY THE
RESERVE BANK OF INDIA BELOW WHICH BANKS
ARE NOT ALLOWED TO LEND TO ITS
CUSTOMERS.
PURPOSE
Transparency
in credit
market
Lower cost of
funds to the
customers
How Is Base Rate Calculated?
The calculation of base rate is based on different
factors. A few of them are:
• Deposit cost
• Administrative cost
• Unallocated overhead cost
• The amount of profit a bank earns in the last
financial year

10. BANK RATE
 IT IS THE RATE CHARGED BY THE CENTRAL BANK FOR
LENDING FUNDS TO COMMERCIAL BANKS. IT IS ALSO
KNOWN AS “DISCOUNT RATE”.
 HIGHER bank rate will lead to HIGHER lending rate
by the Commercial bank & vice versa.
COMPARISON OF RATES
BEFORE COVID-19 DURING COVID-19
5.4% 4.65%

11. TYPES OF REPO RATE
 OVERNIGHT REPO RATE
 TERM REPO RATE
FUNCTIONING OF REPO RATE
OBJECTIVES OF BANK
REPO RATE
CONTRO
L
INFLATION
MONEY
SUPPLY
IT IS THE RATE AT WHICH CENTRAL BANK (RBI IN
CASE OF INDIA) OF A COUNTRY LENDS MONEY
TO COMMERCIAL BANKS IN THE EVENT OF ANY
SHORTFALL OF FUNDS.IT IS ALSO KNOWN AS
“REPURCHASE RATE”.

12. In order to achieve the following objectives the CENTRAL BANK functions in the
following manner
REPO
RATE
HIGH
LOW
BORROWINGS
BORROWINGS
COMPARISON OF RATES
BEFORE DURING
COVID-19 COVID-19
5.15% 4.00%

13. COMPARISON OF RATES
BEFORE COVID-19 DURING COVID-19
4.00% 3.75%
REVERSE REPO RATE
EXAMPLE
For instance, let's assume the reverse repo rate
is 5% p.a. A commercial bank has deposited
RS 10,000 in the central bank this means
the commercial bank will earn RS 500 rupees
p.a. as interest.
IT IS THE RATE AT WHICH THE CENTRAL BANK OF
A COUNTRY(RESERVE BANK OF INDIA IN CASE OF
INDIA) BORROW MONEY FROM COMMERCIAL
BANKS WITHIN THE COUNTRY.

14. FUNCTIONING OF REVERSE REPO RATE
An increase in the reverse repo rate will decrease the money supply and vice versa other things
remaining constant .
An increase in the reverse repo rate means that commercial banks will get more incentive to park the
funds with the RBI thereby decreasing the supply of money in the market .

15. MARGINAL STANDING FACILITY(MSF)
MARGINAL STANDING FACILITY IS THE RATE AT WHICH BANKS
ARE ABLE TO BORROW OVERNIGHT FUNDS FROM RBI AGAINST THE
APPROVED GOVERNMENT SECURITIES. IT IS A NEW LIQUIDITY
ADJUSTMENT FACILITY ( LAF) WINDOW CREATED BY RBI IN ITS
CREDIT POLICY.
BENEFITS
BORROW
FUNDS FROM
RBI
ONE DAY
LOAN
COMPARISON OF RATES
BEFORE COVID-19
4.25%
DURING COVID-19
4.25%

16. STATUTORY LIQUIDITY RATIO(SLR)
IN INDIA THE STATUTORY LIQUIDITY RATIO SLR IS THE GOVERNMENT
TERM FOR THE RESERVE REQUIREMENT THAT COMMERCIAL BANKS ARE
REQUIRED TO MAINTAIN IN THE FORM OF CASH, GOLD RESERVE, PSU BONDS
AND RBI APPROVED SECURITIES BEFORE PROVIDING CREDIT TO THE
CUSTOMER.
COMPARISON OF RATES
BEFORE COVID-19 DURING COVID-19
18.25% 18.00%
Formula for calculating SLR
SLR= LIQUID ASSETS X 100%
[( DEMAND + TIME LIABILITIES)]
DETERMINED
BY
Time
Liabilitie
s
Demand
Liabilitie
s

17. CASH RESERVE RATIO(CRR)
THE CRR IS A PARTICULAR MINIMUM AMOUNT OF THE TOTAL DEPOSIT OF CUSTOMER
THAT NEEDS TO BE MAINTAINED BY THE COMMERCIAL BANK AS A RESERVE EITHER
CASH OR AS DEPOSITS WITH RBI.
FUNCTIONING OF CRR IN BANKS
When the RBI decides to the CRR, the amount of money that is available with the
banks .This is the RBI’s way of controlling the excess flow of money in the economy.
COMPARISON OF RATES
BEFORE COVID-19 DURING COVID-19
3.00% 3.00%

18. FOREIGN
 FOREIGN EXCHANGE RATE IS THE PRICE OF ONE
CURRENCY IN TERMS OF ANOTHER BECAUSE THE
FOREIGN EXCHANGE RATE COMPARES THE CURRENCIES
OF TWO COUNTRIES. IT DEPENDS ON THE VALUE OF
EACH CURRENCY AND THUS ON THE ECONOMIES OF
BOTH THE COUNTRIES.
EXAMPLE
In April 2020 1 USD was equal to 73.83
INDIAN RUPEE . 1 INDIAN RUPEE was equal
to 0.0135 USD
EXCHANGE RATE

19. CALL RATE
CALL RATE IS THE RATE AT WHICH SHORT TERM FUNDS ARE
BORROWED AND LENT IN THE MARKET. IT DOES NOT HAVE
REPAYMENT SCHEDULE AND THEREFORE MUST BE REPAID ON
DEMAND .DEALING IN CALL MONEY IS DONE THROUGH THE
ELECTRONIC TRADING PLATFORM CALLED NEGOTIATED TRADING
SYSTEM (NDS).
COMPONENTS
LIQUIDITY SITUATION IN THE ECONOMY
COMPLY WITH STATUTORY CRR AND SLR
DEMAND FOR FUNDS
COMPARISON OF RATES
BEFORE COVID-19
DURING COVID-19
4.25%
2.00%

20. RATE OF INTEREST
AN INTEREST RATE IS THE AMOUNT OF
INTEREST DUE PER PERIOD AS A PROPORTION
OF THE AMOUNT LENT DEPOSITED OR
BORROWED.
FUNCTIONING OF RATE OF INTEREST
Central banks raise or lower short-term
interest rates to ensure stability and
liquidity in the economy. Low demand
for long-term notes leads to Higher
rates. While Higher demand leads
to LOWER rates.
TYPES OF INTEREST
 Simple Interest
 Compound Interest
 Fixed Interest.
 Variable Interest.
 Annual Percentage Rate (APR)
 The Prime Rate
 The Discount Rate

21. FACTORSAFFECTINGINTEREST RATES
CREDIT
SCORE
LOAN
TERM
HIGHER CREDIT SCORE
LOWER INTEREST RATE
& vice-versa SHORT
TERM
LONG
TERM
LOWER
INTEREST
RATE
HIGHER
INTEREST
RATE

22. 0.00%
2.00%
4.00%
6.00%
8.00%
10.00%
12.00%
14.00%
16.00%
18.00%
20.00%
Bank Rate Repo Rate Reverse Repo
Rate
CRR SLR MSF Call Rate Rate of
Interest (as
per deposit)
GRAPHICAL COMPARISON OF DIFFERENT TYPES OF RATES
BEFORE COVID-19 DURING COVID-19

23. NEWRULES FOR CREDIT AND DEBITCARDHOLDERS
 All debit, credit cards shall be enabled for use only at ATMs and Point of Sale (PoS)
devices within India.
 If customers want to use their debit, credit cards outside India, they would request
their respective banks to enable International transaction facility.
 Banks will have the right to deactivate current cards and reissue them based on risk
perception.
 The bank will have an option to disable the cards if any individual has not used their
card for online transaction before.
 Cardholders will have the option to switch on and switch off their card.
 Customers as well as banks can provide 24*7 mobile applications and net banking
options to modify the limits and enable and disable services.
 Customers will be provided with contactless cards based on NFC technology.

24. RECENTLY MERGED BANKS

25. Safety measures taken by banks
during Covid-19 pandemic
GOING DIGITAL
DIGITAL PAYMENTS
Digital bank account
opening/applying of loans
Providing time concessions
Providing sanitization
facilities
FOR
CUSTOMERS
FOR
EMPLOYEES
Transportati
on
facilities.
Reducing
working
hours.
Split site
working

26. CASE STUDIES

27. PMC BANK CRISIS
Largest urban
cooperative
bank under RBI
Gave loan to HDIL
real estate
developer
Had unresolved
issue of Non-
performing
assets(NPA)

28. PMC BANK CRISIS: HIGHLIGHTS
In 2017, Punjab and Maharashtra
Cooperative Bank Chairman
S Waryam Singh held a stake of
1.91% in HDIL.
PMC bank continued
to lend to HDIL.
The bank issued HDIL founder Sarang
Wadhawan a personal loan of Rs 96.5 crores,
whose company had already defaulted on Rs
2,500 crores loans gradually which led total
debts of HDIL to 6500 crores.
The PMC Bank used at least
21,049 dummy accounts to
cover accumulated non-
performing assets.

29. FRAUDS
In the case of HDIL exposure was at 73 % four times the usual level.
Actions taken into consideration
The Economic
Offences Wing
(EOW) of Mumbai
Police has filed FIR.
PMC Bank’s suspended
director Joy Thomas,
chairman Waryaam
Singh; HDIL’s Rakesh
Wadhawan and Sarang
Wadhawan; other
HDIL-related entities.

30. The
Bank of
Industry
Dena
Bank
The
Bank of
the
Union
The
Bank of
India
FINANCIALINSTITUTION HAVING LOANDEFAULTS
ENFORCEMENT DIRECTORATE
(ED) CONFISCATED
12 high-
end cars
The listed
builder’s
commercial
and residential
properties
worth Rs.3500
crore
Chairman
of HDIL
and his son
Sarang
Wadhawan

31. CONCLUSION
According to RBI statistics, Bank
frauds dropped from 1,926 in 2004
to 1,551 in 2018.
A small capital base is one of the
reasons why cooperative banks fail
so often
Cooperative bank regulation by
RBI is not as stringent as that of
commercial banks

32. YES Bank
CASE ANALYSIS

33. INTRODUCTION
It was the only banking partner for UPI transactions
such as Swiggy, Phone pay, Flipkart, Redbus
Looking at the growth of the bank, people started
depositing more and more, essentially, this value grew
to 2 lakh crores for the bank.
YES bank attained its peak and the highest confidence
among depositors and rating agencies.

34. FRAUD
Dewan
Housing
Finance
Corp. Ltd
(DHFL)
Infrastructu
re Leasing
and
Financial
Services
(IL&FS)
Anil
Ambani’s
Reliance
group
Zee
group
Subhash
Chandra’s
Essel
group
CLIENTS UNDER FINANCIAL STRESS
Started lending billions to companies

35. THE COLLAPSE
Outstanding loans of YES
bank grew from INR 55,000
crore in FY14 to INR 2.41
trillion in FY19.
Rising Non-performing
assets (NPAs) of the bank.
Negative ratings of rating
agencies, the UBS report,
RBI’s correcting measures
on the bank for under-
reporting NPAs.
Panic among the
depositors and the
shareholders

36. CONCLUSION
The Madras High
Court has upheld
the legal validity of
RBI circular on
additional tier
1(AT1) bonds
dismissing the plea
of YES BANK
investors
A two judge bench
has held that the
investors invested
knowing the risks
associated with the
instrument.
Yes Bank's AT1
bonds worth Rs
8415 crore were
written down to
zero in March.

37. PRADHANMANTRI JAN DHANYOJANA
INTRODUCTION

38. MISSIONS AND AIMS
 To bring financially poor
excluded people into banking
system
 It covers both urban and rural
areas
 Raises of the Indian economy
 To decrease corruption in
government subsidy schemes
 Digital India

39. BENEFITS OF PMJDY
 Can be opened with zero balance
 Not required to maintain
minimum balance
 Interest on deposit
 Accidental insurance coverage of
rupees 1 LAKH
 Life insurance cover up rupees
30,000
 Easy transfer of money across
India

40. Performance
Date Total Balance
1st April, 2020 ₹1,19,680 Cr.
8th April, 2020 ₹1,27,748 Cr.
15th April, 2020 ₹1,33,564 Cr.
22nd April, 2020 ₹1,32,564 Cr.
29th April, 2020 ₹1,29,625 Cr.
6th May, 2020 ₹1,31,825 Cr.
13th May, 2020 ₹1,35,883 Cr.
27th May, 2020 ₹1,31,445 Cr.
Changein PMJDY Total Balance during April-May.
1.Transfer of cash
to PMJDY account.
2.Withdrawal of
cash on regular
basis by account
holder.
3.Direct Benefit Transfer
to women account
holder of PMJDY under
PMGKY.