Sunday, 15 July 2018

Jaiib materials

Today Micro finance 70 recollected questions



 Micro finance 70 recollected questions

Q1.C.rungrajan committee on microfinance
Q2. Breath length and depth meaning.
Q3. Difference between poverty lending approach and financial system approach.
Q4. Microfinance focus on poorest of the poor.
Q5. Nabard and it's role.
Q6. Nationalization of banks and it's purpose.
Q7.IRDP programm substitute the SJGSY program.
Q8.what is facilitater and it's role.
Q9.what is GRT group recognition test and it's purpose.
Q10.one question on Money lenders.
Q11.break even analysis and CPV analysis 3 questions.
Q12.what is microcredit.
Q13.what is microfinance.
Q14. What is sustainability.
Q15 what is BRI bank Ryat Indonesia.
Q16 .what is unit diseas.
Q17.chikola group of Kenya is example of which model.
Q18.Difference between SHG and JLG model
Q19 detailed question on grameen bank model.
 Q20. What is SHG bank linkage model...
Q22. Assumptions of grameen bank model of Bangladesh.
 Q23.diffrence between direct cost indirectcost setupcost and cost of fund.
Q24 .capital=assets-liability.
Q25.for NBFC model minimum networth requires rs.5 crore.
Q26.malegam committee and its recommendation.
Q27.qualifying assets and its significance
Q28.what is most accepted and widely usedmodel of microfinance in india.
 Q29.what is ghostborrower or multiple lending.
Q30.details of BC model.
Q31.what is reckless lending.
Q32. Details of SHG2 model part2.
 Q33. What is refinancing.
Q34. National rural livelihood mission.
 Q35 .Swarn jayanti gramin Swarojgar yojna
Q 36.what is mutual fund.
 Q37. What is merchant banking.
Q38.details of Revolving Fund.
 Q39. Financial inclusion definition and scope.
Q40. What is kyc and it's purpose
Q41 .Illiterate person can open which type of exam.
Q42 .Difference between impact accessment and social performance.
Q43.what is social rating
Q44. What is minimalist and integrated approach.
Q45.what is micro Insurance.
 Q46. Role of SEBI.
 Q47.role of IRDA.
 Q48. What is cash flow statement
.Q49. What is flat rate of interest.
 Q50. What is travel expanses.
 Q51.what is operating expense Ratio.
 Q52. What is asset depricitation.
 Q53 what is accounting stanard 2
. Q54. What is average case load.
Q55. What is Target group.
Q56. What is PAR.
Q57. What is market risk.
Q58. What is bank rate.
Q59.what is reprising risk.
 Q60. What is riskmanagement loop
Q61 what is schedule and nonshedule bank.
Q62. What is human risk.
 Q63.what is operational risk.
Q64.what is merchant banker.
 Q65. What is trading in stock exchange.
 Q66.two questions on mutual fund.
Q67.three question on Break Even Analysis.
Q68. What is regulatory risk.
 Q 69.what is Repayment rate.
 Q70.trust and Trust feed and what NBFC banking Model and what is business Correspondent model (BC Model)...... these All are 70 Recollected Questions of microfinance held on 15 july 2018. best of luck to All 

Credit management

Certified credit professionals::

       (Simple and nice read every one)

Credit management is one of the core processes for all banks and therefore, the
ability to manage its process is essential to augment interest income and to enhance
its profitability. The success of a bank crucially depends how it manages its Asset
Portfolio as it is the major source of income and has direct bearing on the bottom-
line of the Bank. This demands an ability to perceive the early warning signals, which
necessitates control of both the quantitative and qualitative aspects of credit
evaluation. Thus, managing credit risk plays an important role and its effectiveness
lies in proper identification of borrower and appraisal besides adopting an efficient
recovery and exit strategy.
1. Know Your Customer (KYC): Proper identification of the borrower attains
utmost importance in the entire credit cycle for which adoption of KYC guidelines is a
must. It is observed that majority NPA accounts pertain to either new customers or

Today MSME recollected questions

Today's asked questions in msme exam:
ITCOT Based in ?
Tile industry cluster Mangalore disappeared due to?
FIWE h/q ?
SSIDC Registered under?
WTO Set up in?
Net rating agency for small industry?
Numerical questions:
1. Working capital turnover ratio 5
Current ratio 2:1
Current assets 30lakh
Profit is 6% of sale find net profit?
2. Net profit 40 lakh, dep 10 lakh, int on term loan 10lakh and DSCR IS 2 FIND INSTALMENT OF TERM LOAN?
3. CURRENT ratio 2.7:1
DEAR 0.6:1 What is interpretations in business?
4. Current ratio 2:1 current assets 60lakh, total liabilities 110 lakh term loan 35 lakh , find net worth?
5.NPA provisioning
6.SARFASEI
7.NIESBUD
8.Reservation items of MSME
9. Kishore,tarun,shishu
10.Small and medium enterprises investment in plant and machinery

MSME:
*maximum shareholders in a private company from according to 2013 Act-200
* SARFAESI act enacted year-2002
*UNIDO implemented a development initiative in the knitwear cluster-Ludhiana
*Red clause LC -buyer is extending an unsecured loan to the seller
*Non fund based facilities- deffered payment guarantee
*Options for financing MSME- equity, venture capital, Angele fund
*Hybrid capital refers to combination of -equity and debt


Some of the recollected questions MSME 15072018
Deadline for Basel 3 implementation in India
Basel 3 aim to promote resilient banking parameters namely ?
CRM is ----- approach
Limits for mudra loan in shishi kishor tarun
One question on OTS scheme
Rehabilitation package for potentially viable units within-- month
Composite loan amt ?
SARAFAESI act enacted in which year
Banning industries which not having scope is the role of ?
2question on internal and external causes of sickness
1 question on symptoms of sickness
Steps in cluster devp project
Example if diffusion effect of tech ...Change
Msme credit process - 5 stages
1 question on fund based non fund based guarantee
Objective of FIWE
ISO 9000 credit reimbursement amt
Forei investment outside the automatic route clearance has to be obtained from - FIPB
2 questions on no of directors and members in private public Ltd co

Today IT security recollected questions

IT Security recollected questions 15-07-18

Non repudiation,access privilege,2FA,CISO,corporate  IT Security,DRM,Threat,vulnerabilities,risk appetite,sec governance,rfid,ips,ids,bar coding,metal detectors,fire extinguishers,testing methodologies 2-3 questions,cloud computing 2-3 questions,cdr,iso 27001,cobit,etsi tc cyber,Sox,sas 70,defense in depth,green server,refurbishment,dumpster driving,social eng,database schema,atm security,jackpotting,escrow arrangement 2 questions,spf,vlans,mpls,ftp,firewalls,siem,s/w models,big data,buffer overflow,stuxnet,botnet,fast flux,rootkit,San,drsite,Indian fin sys,powers of rbi

Most of d questions wr of the type (what is not),(which is wrong)



IT security recollected questions

IT act defines data as

Information is classified based on criticality, confidentiality, availability and purpose

Information security is protection of information assets

Non repudiation definition

Which of the following is not a perimeter security method

IT security is responsibility of All employees in an organisation

CISO will not report to CIO

Access previlage: clerical staff cannot make loan disbursement

What is pretty good privacy

Digital right management involves copy right and antipiracy technology

Difference between threat and vulnerability

Definitions of threat vulnerability impact and risk

Crime is not because of need, opportunity and rationalization. One wrong option

2 questions on metal detectors

Which of the following is not an intrusion detection systems - biometric tools

Social engineering is done by

SQL injection definition

Buffer overflow definition

First digital weapon used in PLC - stuxnet

Which of the following is not true regarding cyber terrorism

Malware that targets industrial and software equipment - stuxnet

Fast flux definition

Rootkit related question

What do you understand by the term hijacker

What is the concern faced by security managers in BYOD technology

Case study type question on single point failure

Features of fault tolerant system-2 questions

One of the following is not a requisite for fault tolerance

One of the following is not true regarding high availability-latency, raid,

Questions on white box testing and black testing

Software fault tolerance methods include recovery blocks, n programming, acceptance tests

Recovery time objective., recovery point objective

Robo backup

DR site location in seismic zone

Hot site, warm site

Secondary site located in same city as primary data centre

Auditing around the computer, auditing through the computer, auditing with computer

COBIT is not a security standard

Latest version of COBIT is COBIT 5

Audit risk definition

RBI, sebi, tria and irda regulates (match the following)

One of the following is not the role of RBI

Call data record includes

One of the following is not included in IT act

Version control

Escrow arrangement

Cloud computing and big data

COBIT VERY important for IT

COBIT (Control Objectives for Information and Related Technologies) is a good-practice framework created by international professional association ISACA for information technology (IT) management and IT governance. COBIT provides an implementable "set of controls over information technology and organizes them around a logical framework of IT-related processes and enablers
ISACA first released COBIT in 1996, originally as a set of control objectivesto help the financial audit community better maneuver in IT-related environments.Seeing value in expanding the framework beyond just the auditing realm, ISACA released a broader version 2 in 1998 and expanded it even further by adding management guidelines in 2000's version 3. The development of both the AS 8015: Australian Standard for Corporate Governance of Information and Communication Technologyin January 2005 and the more international draft standard ISO/IEC DIS 29382 (which soon after became ISO/IEC 38500) in January 2007

Saturday, 14 July 2018

MSME information for MUDRA

MUDRA – Micro Units Development & Refinance Agency Ltd
Under the aegis of Pradhan Mantri MUDRA Yojana, MUDRA has already created its initial products / schemes. The interventions have been named 'Shishu', 'Kishor' and 'Tarun' to signify the stage of growth / development and funding needs of the beneficiary micro unit / entrepreneur and also provide a reference point for the next phase of graduation / growth to look forward to :

• Shishu : covering loans upto 50,000/-
• Kishor : covering loans above 50,000/- and upto 5 lakh
• Tarun : covering loans above 5 lakh and upto 10 lakh

FEDAI Imp points

FEDAI

The important rules are:

Export Transactions : Forex liability must be crystallized into Indian rupees on 30th day after expiry of NTP (Notional Transit Period) in case of Sight bills and on 30th day after notional due date in case of Usance bills. The rule has since been relaxed and bank can frame its own rule for nos. of days for crystallization.

Concessional rate of interest is applied up to Notional due date or up to value date of realization of export dues (whichever is earlier)

Import Transactions: For retirement of Import bills whether under LC or otherwise, banks Bill

selling rate on date of retirement or the Forward rate will be applied.

DP Bills (sight) are retired after crystallization on 10th day after receipt.

DA Bills are retired (crystallized) on Due Date.

All Foreign Currency bills under LC, if not retired on receipt, shall be crystallized into Rupee liability on 10th day after date of receipt of documents at TT Selling Rate.

Normal Transit Period is:

- 25 days for export bills,

- 3 days for Rupee bills drawn under LC and payable locally

- 7 days for rupee bills drawn under LC and payable at other centers

- 20 days for Rupee bills not drawn under LC.

- For exports to Iraq, normal transit period is 60 days.

All the best for your exam

If you want to touch your goals, you have to do well in the exam. Exam will give you the opportunity. So, try to give the best effort in exam. Good Luck!

In your life, you can’t get anything easily. You have to earn that. We all have to go through our educational system. Exams are the options which help you to go ahead. So take it carefully. Best of luck!

Failure & success are the two sides of the same coin. So don’t get nervous. I know you can do well in the exam.

Failing in a exam is not so serious issue in life. If you have failed today then try the best for tomorrow. I know tomorrow will show us your talent. Be confident! Good luck!

Exam is waiting for giving you a chance of testing your knowledge. Just believe in yourself! Best of luck!

Exams can prove you how brilliant and intelligent you are than the others. So, you should grab the opportunity. Best wishes for you!

These exams are your opportunity at proving your worth to everyone around you. Grab it and do your best, don’t let it pass through. Good luck.

In life, it is impossible to be 100% sure of whether you will pass or fail. But working hard is a sure shot way to increase your chances of doing well. Good luck.

Exam Advice for Students
Exams don’t test your knowledge as much as they test your state of mind. Be relaxed and calm down, I am sure you will do fine. Best wishes to you.

Good grades are life’s way of saying that there is a bright future in store for you. Good luck.

Before you go and take the exam, just relax, you already know everything, take a walk in the afternoon, watch a film, listen to some music and have a good sleep. Good luck for your exams!

Nothing can stop you from doing your best, nothing can pull you down – as long as you start studying hard and stop fooling around. Good luck.



Hard work always pays in life. You can reach every aim you want. I wish you all the best for this hard work.

Hundreds and thousands of people in the world give exams every day. Surely, something so common and ordinary can’t be too difficult. Good luck.

You worked hard in school all year long, and now you will use this knowledge! Everything you learned will be needed today! Remember everyone wishes you good luck, the teachers, friends and family!

Friday, 13 July 2018

MSME related abbreviations

ABBREVIATIONS::

ACWW: Associated Country Women of the World
AIC: Agro Industries Corporation
ANC: Ancillary Undertakings
APTDC: A. P. Technology Development Centre (CII)
ASBA :Alliance of Small Business Associations in the USA
ASI: Annual Survey of Industries
ASSOCHAM Association of Chambers of Commerce and Industry
AWEK Association of Women Entrepreneurs of Karnataka
BDS Business Development Services
CAR Common Annual Return
CDCC Central Documentation and Clearance Centre
CDR Corporate Debt Restructuring
CGTMSE: Credit Guarantee Fund Trust for Micro and Small Enterprises
CGTSI Credit Guarantee Trust for Small Industries
CII Confederation of Indian Industry
CITD Centre for International Trade in Agriculture and Agro-based Industries, New
Delhi
COSIA Chamber of Small Industry Associations
CRM Customer Relationship Management
CWEI Consortium of Women Entrepreneurs in India
CWEI Consortium of Women Entrepreneurs of India
DIC District Industries Centre
DICGC Deposit Insurance & Credit Guarantee Corporation
DRT Debt Recovery Tribunal
DWCRA Development of Women and Children in Rural Areas
EDIT Entrepreneurship Development Institute of India
EOU Export Oriented Units
EU European Union
EXIM BankExport Import Bank of India
FAPCCI Federation of Andhra Pradesh Chambers of Commerce and Industry
FAPSIA Federation of Andhra Pradesh Small Industries Association
FASII Federation of Associations of Small Industries of India
FDI Foreign Direct Investment
FICCI Federation of Indian Chambers of Commerce and Industry
FISME Federation of Indian Micro & Small and Medium Enterprises
FISME Federation of Indian Small & Medium Enterprises
FIWE Federation of Indian Women Entrepreneurs
FOSMI Federation of Small & Medium Industries
GATT General Agreement on Trade and Tariff
Gol Government of India
HUDCO Housing & Urban Development Corporation
HUF Hindu Undivided Family
ICSI Indian Council of Small Industry
ICWE India Council of Women Entrepreneurs, New Delhi
IDLSS Integrated Development of Leather Sector Scheme
IIA Indian Industries Association
IIC Industrial Infrastructure Corporation
IIE Indian Institute of Entrepreneurship, Guwahati
IRAC Income Recognition and Asset Classification
ISEC Interest Subsidy Eligibility Certification
JHF Joint Hindu Family
KVIC Khadi & Village Industries Commission
LLP Limited Liability Partnership
MFA Multi-Fibre Arrangement
MSE-CDP Micro & Small Enterprises Cluster Development Programme
MSMED Micro Small and Medium Enterprises Development
NABARD National Bank for Agriculture and Rural Development
NAYE National Alliance of Young Entrepreneurs
NGO Non-Governmental Organization
NIC National Industrial Classification
NIESBUD National Institute for Entrepreneurship and Small Business Development,Noida
NIMSME National Institute for Micro, Small and Medium Enterprises
NISBET National Institute of Small Business Extension Training
NMCP National Manufacturing Competitiveness Programme
NPA Non-Performing Asset
NPV Net Present Value
NRY Nehru Rojgar Yojna
NSIC National Small Industries Corporation
OECD Organisation for Economic Co-operation and Development
OGL Open General License
OTS One Time Settlement
PACS Primary Agricultural Cooperative Credit Society
PCB Pollution Control Board
PMEGP Prime Minister's Employment Generation Programme
PPP Public Private Participation
PRF Portfolio Risk Fund
PRODIP Product Development, Design Intervention and Packaging
QRs Quantitative Restrictions
RBI Reserve Bank of India
RGUMY Rajiv Gandhi Udyami Mitra Yojana
SEZ Special Economic Zone
SFC State Financial Corporation
SFURTI Scheme of Fund for Regeneration of Traditional Industries
SHG Self Help Group
SIDBI Small Industries Development Bank of India
SIDC State Industrial Development Corporation

SIDO Small Industries Development Organisation
SIIC State Industries Investment Corporation
SMERA Small & Medium Enterprises Rating Agency of India Ltd.
SMEs Small and Medium Enterprises
SNDP State Net Domestic Product
SPV Special Purpose Vehicle
SSIDC State Small Industries Development Corporation
SSSBE Small Scale Service and Business (industry-related) Enterprises
TANSTIA Tamil Nadu Small and Tiny Industries Association
TCO Technical Consultancy Organisation
TREAD Trade Related Entrepreneurship Assistance and Development
TRIPs Trade-Related Intellectual Property Rights
TRYSEM Training for Rural Youth for Self Employment
TUFS Technical Upgradation Fund Scheme
WE Town and Village Enterprises
UNIDO United Nations Industrial Development Organization
VAT Value Added Tax
WASME World Association for Small and Medium Enterprises
WASME World Association of Small and Medium Enterprises
WAWE World Association of Women Entrepreneurs
WE Women Enterprises
WTO World Trade Organisation

Most important banking terms for every bankers

FIFTY BANKING TERMS FOR BANK INTERVIEWS/EXAMS

( Don't miss ... Read every one and Get knowledge)

1. Repo Rate

1.When RBI provides a loan to the bank for short-term between 1 to 90, RBI takes some interest from the bank which is termed as Repo Rate.

2. Reverse Repo Rate
⏫When bank deposit it's excess money in RBI then RBI provides some interest to that bank. This interest is known as Reverse Repo Rate.

3. SLR –(Statutory Liquidity Ratio)
⏫Every bank has to maintain a certain % of their total deposits in the form of (Gold + Cash + bonds + Securities) with themselves at the end of every business days.

4. Retail banking
⏫Retail banking is a type of banking in which direct dealing with the retail customers is done.
⏫This type of banking is also popularly known as consumer banking or personal banking.
⏫It is the visible face of banking to the general public.

5. Bitcoin
⏫Bitcoin is a virtual currency/ cryptocurrency and a payment system.
⏫It can be defined as decentralized means of tracking and assigning wealth or economy, it is a software protocol.
⏫Bitcoin uses two cryptographic keys, one public (username) and one private (password) are generated.
⏫1Bitcoin= 108 Satoshi.

Types of Banking

Para Banking:
Para banking activities are defined as those banking activities which a bank performs apart from its daily activities like withdrawal or deposit of money.
Under para banking activities banks can undertake activities either departmentally or by setting up subsidiaries.

Narrow Banking:
This is a type of banking in which banks invest money mostly in government bonds and securities.
This is done to avoid risk in the market.
Banks dedicated to such type of banking are also known as Narrow Banks.

Offshore Banking
When a bank accepts currencies of countries abroad, such an activity is known as Offshore banking
Sometimes people require more than their local banks can offer. In such cases, they opt for Offshore banking.
It provides financial and legal benefits like privacy and minimal taxation.

Green Banking
Green banking promotes deployment of clean energy technologies.
It stresses on environmentally friendly practices and aims at reducing the carbon footprint from banking activities.
These activities seek to reduce costs of energy for ratepayers, private sector investments and other economic activities.

Retail Banking
Retail banking is a type of banking in which direct dealing with the retail customers is done. This type of banking is also popularly known as consumer banking or personal banking
Retail banking is the visible face of banking to the general public.

Wholesale Banking
Wholesale banking can be referred to as the services provided by banks to organisations like Mortgage Brokers, corporate clients, medium scale companies, real estate developers and investors, international trade finance businesses, institutional customers (such as pension funds & government agencies) and services offered to other banks or financial institutions.

Universal Banking
The recommendation of the concept of Universal Banking was done by the R H Khan committee.
This is a type of banking in which banks are allowed to undertake all types of financial activities regarding banking or development in accordance with the statutory and other requirements of RBI, Government and related legal Acts.
Universal Banking includes activities like accepting deposits, issuing credit cards, investing in securities, merchant banking, foreign exchange operations, etc.

Islamic Banking
Islamic banking is a kind of banking activity which strictly follows the principles of the Islamic law (Sharia) and its application practically through the development in Islamic economics
A better and more apt term for Islamic banking is Sharia Compliant Finance.

Unit Banking
USA is where such type of banking was first introduced.
In such a type of banking, all the operations are performed from a single branch.
A customer having an account in a specified branch has to undergo all banking activities through that branch.
Examples are Regional Rural Banks and Local Area Banks.

Mixed Banking
Mixed banking is a type of banking in which deposits and investment activities take place simultaneously.
It can also be described as the dual functioning of investment banking and commercial banking.

Chain Banking:
Chain banking is a type of banking which is a group of minimum 3 banks held together by a group of people to carry out effective banking activities.
Instead of having a holding company the bank functions independently.
The revenue is maximised since there is no overlap of activities.

Relationship Banking
In such a type of banking, the the major needs of the customers are understood by the bank and accordingly banking services are provided to the individual.
Banks get to know if the customer is credit worthy since they have to gather information about its customers.

Correspondent Banking
In more than 200 countries, this type of banking is prevalent and is considered the most profitable way of doing business.
In such a type of banking, the bank does not have a physical presence or any limitations in the permission of operations.
It acts as a banking agent for a home bank.

MSME special

ABCD OF MSME :::: Excellent Content plz read everybody..

1.Keynote address delivered by Shri S. S. Mundra, Deputy Governor, Reserve Bank of India at the 2nd CII
National Conference on MSME Funding held in New Delhi on August 23, 2016 ).
Thank you for inviting me to deliver the keynote address at this second edition of the Conference on
MSME Funding. I compliment the CII for having chosen a very relevant theme for the Conference
‘Propelling MSME Growth through Enhanced Financial Access and Support’. The theme lays emphasis on
two crucial pillars that are pertinent for the sector i.e. enhancing financial access and ensuring adequate
support to enable MSMEs to attain faster growth.

Thursday, 12 July 2018

RBI Notification

Incorporation of Name of the Purchaser on the Face of the Demand Draft

RBI vide its circular RBI/2018-19/14, DBR.AML.BC.No.210/14.01.001/2018-19 dated 12.07.2018 has made it compulsory to banks to incorporate the name of the purchaser on the face of the Demand Draft while purchasing it at a bank (including RRBs, Co-operative banks).

In terms of the above notification, Section 66 of the Master Direction on KYC dated February 25, 2016, as amended on April 20, 2018, has been amended and following paragraph has been added:

Further, the name of the purchaser shall be incorporated on the face of the demand draft, pay order, banker’s cheques, etc., by the issuing bank. These instructions shall take effect for such instruments issued on or after September 15, 2018.

It is learned that the above step was taken by RBI in order to address the concerns arising out of the anonymity provided by payments through demand drafts and its possible misuse for money laundering.

Imp banking terms

IMPORTANT BANKING TERMS

Repo Rate
Repo rate is the rate at which our banks borrow rupees from RBI. Whenever the banks have any shortage of funds they can borrow it from RBI. A reduction in the repo rate will help banks to get money at a cheaper rate. When the repo rate increases, borrowing from RBI becomes more expensive.

Reverse Repo Rate
This is exact opposite of Repo rate. Reverse Repo rate is the rate at which Reserve Bank of India (RBI) borrows money from banks. RBI uses this tool when it feels there is too much money floating in the banking system. Banks are always happy to lend money to RBI since their money is in safe hands with a good interest. An increase in Reverse repo rate can cause the banks to transfer more funds to RBI due to these attractive interest rates.

CRR Rate
Cash reserve Ratio (CRR) is the amount of funds that the banks have to keep with RBI. If RBI decides to increase the percent of this, the available amount with the banks comes down. RBI is using this method (increase of CRR rate), to drain out the excessive money from the banks.

SLR Rate
SLR (Statutory Liquidity Ratio) is the amount a commercial bank needs to maintain in the form of cash, or gold or govt. Approved securities (Bonds) before providing credit to its customers. SLR rate is determined and maintained by the RBI (Reserve Bank of India) in order to control the expansion of bank credit.

Most important for bankers

Most important topic forever useful::

Individual Elements of Balance Sheet
and Their Analysis:::

Liabilities
 Current Liabilities
 Term Liabilities
 Debentures
 Public Deposits
 Capital
 Reserves (including
Revaluation reserve)

Assets
 Current Assets
 ICDs/Loans
 Fixed Assets
 Capital Work-in-
Progress
 Investments
 Other Non-Current
Assets
 Fictitious & Intangible
Assets

Current Liabilities
 Current liabilities are the liabilities, including bank
borrowings, which are payable within next 12 months.
Thus, the following items are treated as current
liabilities:
 Sundry creditors for raw material supplies and other
expenses
 Advance payment received
 Dividend payable
 Instalments of term loans/deposits/DPGs/debentures
due within one year
 Any other liability which will fall due in next 12 months

Term Liabilities
 Term liabilities include loans taken from
banks or Financial Institutions for long-term
usage, which are repayable over a longer
time period. While instalment payable in next
12 months is classified as current liabilities,
the remaining instalment amount that is due
for payment after a year is classified as term
liabilities.

Debentures
 The features of debentures are:
 They are essentially in the nature of loans - much like
long-term loans granted by banks / financial
Institutions
 Companies raise them from general public and
institutions, to be repaid within a specific time frame
 Companies pay interest at a specified rate to
debenture holders from whom they raise debentures,
till they repay the principal sum
 They come in the form of certificates issued by a
company under its common seal, which is also an
acknowledgement of the company's indebtedness to
the debenture holder

Public Deposits'
 Care to be Exercised by Lending Banker
Should take care, particularly, in cases where
the company has defaulted in repaying such
public deposits
 May treat all such public deposits which have
become due for repayment, and the portion of
small investments (regardless of the age of
such deposits), as current liability

Capital
 Capital of a business enterprise is an item of
liability by virtue of:
 The entity concept used in the preparation of
financial statements, which treats capital as a
liability.
 The principles of accountancy, according to
which the enterprise owes this sum to the
owner(s) and therefore carries a liability to
pay back the capital fund with or without any
profit earned on it

Reserves
 A Reserve
 Consists of the portion of the earnings and
receipts.
 Does not serve as a provision against a
known liability or any diminution in the value
of fixed assets (i.e. accumulated depreciation)
etc., in contradistinction to Reserves which is
part of net worth of the company

Surplus
 A Surplus
 Represents credit balance in the profit and
loss account, after the dividend and reserves
etc. are provided for, appropriated or
transferred.

Assets - Current Assets
 Current assets are those assets, which: Are expected
to be converted into cash e.g. raw material, stock-in-
process, finished goods etc. in next 12 months, and
Pertain to the company's main activity
 However, in respect of receivables, the treatment is
different. Receivables are treated:
 As current assets only for a period of 6 months
 As non-current assets, if they are more than 6
months old

Fixed Assets
Fixed assets are the assets:A credit analyst
should:
 Held for use in production or providing goods,
services etc. over a long period of time
 Not meant for sale in the normal course of
business
 That are producers of merchandise and not
merchandise themselves

Assets - Investments
 Investments made by a company, appearing in the
balance sheet of a company:
 Is a very important item, appearing in the assets side,
from the point of view of a credit analyst
 Normally indicates deployment of funds in securities
or assets, which may not be directly related to the
main activities of the companyMay refer to the
surplus funds of enterprises, which they decided to
invest in short-term securities for earning profit/short-
term gainsMay also refer to, funds invested in the
shares/securities of another enterprise in which the
investor company is interested on a long-term basis.
E.g.: Investment made in subsidiaries.

Assets - Other Non-Current Assets
 Other non-current assets include:
 Advances to suppliers of capital goods (plant,
machinery etc.)
 Deferred receivables (maturity after 1 year)
 Receivables more than 6 months old
 Non-consumable stores and spares
 Dues from directors et

Assets - Fictitious & Intangible
Assets
 Fictitious Assets
 Companies incur certain expenses, which are
not charged to the profit & loss account either
fully or in part during the same year in which
they are incurred. These expenses figure on
the asset side of a balance sheet, as though
they are real assets. Such assets are known
as fictitious assets.

Assets - Fictitious & Intangible
Assets
 Intangible Assets
 Assets that may not represent any real or
tangible asset are called as intangible
assets.Intangible assets represent monetary
values of different rights enjoyed by the
business enterprise, and are therefore
considered as assets. This category of items
include goodwill, patents, copyrights,
trademark rights etc. that appear on the asset
side of a balance sheet.

Indicators for suspicious transactions::::

Indicators for suspicious transactions::::( Most important exam  and General( Daily) Banking  point of view) ( Every one read this article at least once)

Suspicion of proceeds of crime

Match of customer details with known criminals or persons with suspicious
background
Match with UN list – IS IT BEING DONE IN SCBs/DCCBs/RRBs??
Customer has been the subject of a law enforcement inquiry
Customer who conducts transactions in a pattern consistent with criminal
proceeds
Lottery scam or recruitment scam
Multi-level marketing
Transaction from high risk or sensitive area
Unusual or complex transaction
Transaction is unnecessarily complex
Unusual single or aggregate transfers
Transaction is inconsistent with customer profile
Routing of transfer through multiple locations or accounts or unexplained
transfers between accounts
“U-Turn” Transactions
Structuring - transactions split to evade reporting
Unexplained activity in dormant accounts
Suspicious use of ATM card
Doubtful source of payment for credit card purchases

No economic rationale or bonafide purpose::

Volume or frequency of transactions has no economic rationale
Use of agents or associates to disguise the beneficial owner
Common Unique IDs used by multiple customers
Common address/telephone used by multiple unrelated customers
Multiple cash transactions in a single day
Transactions with countries known for secret banking practices
Transactions inconsistent with customer’s profile
Maintaining multiple accounts without explanation
Unexplained cash deposits in bank account
Frequent cash transactions just under the reporting threshold
Multiple cash transactions in multiple accounts
Cash deposits followed by issue of instruments
Suspicious cash withdrawals from bank account
High value cheque deposits followed by immediate cash withdrawals

Non Financial Indicators::

Usage of Lockers

Behavioral Indicators:::

Customer is hurried, nervous or evasive
Customer has no or little knowledge about transaction
Customer is accompanied by unrelated individuals.
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Reluctance to meet in person, representing through power of attorney
Customer aborts transaction after being informed that identification
information will be required
Reluctance to provide original ID
Customer makes inquiries or tries to convince staff to avoid reporting
Providing different identifications or details (such as phone or address) on
different occasions in an attempt to avoid linking of transaction.

Knowledge Indicators::

Customer tries to convince staff not to complete the formalities
Customer thoroughly aware of legal position on suspicious transaction
reporting.
Customer seems very conversant with money laundering or terrorist activity
financing issues.
Customer is quick to volunteer that funds are clean or not being laundered.
Identity indicators
Customer doubtful or vague information given.
Customer gives false identification or identification that appears to be
counterfeited, altered or inaccurate.
Instead of his own some other identification is submitted by Customer.
All Identity documents presented are not verifiable i.e. Foreign documents
etc.
All identification documents appear to be recently acquired.
Identity matches with known ‘hot/watch lists’

Transactions indicators::

Frequent cash transactions in large amounts which is not normally done by
the customer.
Small denominations frequently changed for large ones.
Dirty/smelly notes deposited.
Customer consistently makes cash transactions that are just under the
reporting threshold amount in an apparent attempt to avoid the reporting
threshold .
Frequent purchase of travellers cheques, DDs, etc. with cash when this
appears to be outside of normal activity for the client.
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Accounts Indicators::

A long distance customer opening an account/s.
Account/s opened with names closer to established industrial houses/
groups.
Intra bank transfer of funds - accumulated into one account for foreign
remittance.
Opening of several accounts simultaneously, some of which remain dormant
for long periods.
A third party appears to be using the account of customer.
Customer frequently using different locations other than the place of account
opening to deposit funds.
Activity in account
Account activity inconsistent with nature of business.
Transaction involves NGOs or charitable organization for which there appears
to be no logical economic purpose or where there appears to be no link
between the stated activity of the NGO or charitable organization and the
other parties in the transaction.
Transaction is unnecessarily complex.

COMMITTEES ON ADVANCES & PRIORITY SECTOR



COMMITTEES ON ADVANCES & PRIORITY SECTOR

a. Committee on Wilful Default 2002 S S Kohli

b. Committee on Corporate Debt restructuring 2005 S Gopinath ( Dec. 2005 )

c. Micro, Small & Medium Enterprises 2010 T K A Nair

d. Rehabilitation of Sick SMEs 2008 Dr. K. C. Chakrabarty

e. Flow of Credit to Agriculture 2004 V S Vyas

f. Service Area Approach (rural & urban area) 1988 PD Ojha

g. Financial Inclusion 2006 C Rangarajan

h. Procedure and Processes of Agricultural Loan 2007 C P Swarnkar

i. Rural Credit and Microfinance 2005 H R Khan

j. Flow of Credit to SSI Sector 2004 A S Ganguly

k. Micro finance 2003 Vepa Kamesam

l. Agricultural Credit Delivery (no Dues Certificate) 1998 R V Gupta

m. Lead Bank Scheme 2009 Usha Thorat

n. Micro Finance Institutions 2011 Y H Malegam

o. Institutional Credit to SSIs 1998 S L Kapoor

p. Institutional Credit to SSIs 1974 PR Nayak

q. Committee on to assist Distressed Farmers : S S Johl

r. SHG Credit Linkage Kalia Committee

MUDRA MSME



MUDRA BANK

Introduction: Mudra Bank stands for Micro Units Development Refinance Agency (MUDRA). MUDRA

Bank was announced by the Finance Minister Arun Jaitley in his FY 15-16 Budget speech. Micro Units

Development and Refinance Agency Bank (or MUDRA Bank) is a public sector financial institution.

Mudra Bank is being set up through a statutory enactment and will be responsible for developing and

refinancing through a Pradhan Mantri MUDRA Yojana. Although 20% of the country's population is

dependent on 5.7 crore micro and small entrepreneurs, they do not have access to institutional credit.

Since small entreprenuers are businssess are often cut off from banking system because of limited

branch presence, Mudra Bank will partner with local coordinators and provide finance to "Last Mile

Financiers" of small/micro businesses. The aim is to provide financial assistance to the "unfunded"

small entrepreneurs who provide employment to a large number of people. The Government will

ensure that measures to be taken up by MUDRA are targeted towards mainstreaming young, educated

or skilled workers and entrepreneurs including women entrepreneurs. The MUDRA banks will be set up

under the Pradhan Mantri MUDRA Yojana scheme. It will provide its services to small entrepreneurs

outside the service area of regular banks, by using last mile agents. About 5.77 crore (57.7 million)

small business have identified as target clients using the NSSO survey of 2013. Only 4% of these

businesses get finance from regular banks. The bank will also ensure that its clients do not fall into

indebtness and will lend responsibly. The bank will cater to 5.77 crore small business units that are

spread all across India who currently find it difficult to access credit from the regular banking system.

Objectives: The principal objectives of the MUDRA Bank are:

1. Regulate the lender and the borrower of microfinance and bring stability to the microfinance system

through regulation and inclusive participation.

2. Extend finance and credit support to Microfinance Institutions (MFI) and agencies that lend money

to small businesses, retailers, self-help groups and individuals.

3. Register all MFIs and introduce a system of performance rating and accreditation for the first time.

This will help last-mile borrowers of finance to evaluate and approach the MFI that meets their

requirement best and whose past record is most satisfactory. This will also introduce an element of

competitiveness among the MFIs. The ultimate beneficiary will be the borrower.

4. Provide structured guidelines for the borrowers to follow to avoid failure of business or take

corrective steps in time. MUDRA will help in laying down guidelines or acceptable procedures to be

followed by the lenders to recover money in cases of default.

5. Develop the standardised covenants that will form the backbone of the last-mile business in future.

6. Offer a Credit Guarantee scheme for providing guarantees to loans being offered to micro

businesses.

7. Introduce appropriate technologies to assist in the process of efficient lending, borrowing and

monitoring of distributed capital.

8. Build a suitable framework under the Pradhan Mantri MUDRA Yojana for developing an efficient lastmile

credit delivery system to small and micro businesses.

9. Laying down responsible financing practices to ward off indebtedness and ensure proper client

protection principles and methods of recovery.

Major Product Offerings: MUDRA Bank has classified the borrowers into three segments: the

starters, the mid-stage finance seekers and the next level growth seekers. The Bank will nurture small

businesses through different stages of growth and development of businesses termed as Shishu,

Kishor and Tarun.

Shishu: This will be the first step when the business is just starting up. The loan cover in this stage

will be upto Rs 50,000.

Kishor: In this stage, the entreprenuer will be eligible for a loan ranging from Rs 50,000 to Rs 5 lakh.

Tarun: This last and final category will provide loans for upto Rs 10 lakh.



Types of Credit Facilities

Types of Credit Facilities

1) Fund based lending
2) Non fund based lending

Fund based lending, where the lending bank commits the physical outflow of funds.
The various forms in which fund based lending may be made by banks.

The facilities like Overdrafts,Cash Credit A/c, Bills Finance, Demand Loans, Term Loans etc, wherein immediate flow of
funds available to borrowers, are called funds based facility. The non fund based facilities like issuance of letter of guarantee, letter of credit wherein banks get fee income and there is no immediate outfow of funds from bank.

Overdrafts: Overdraft means allowing the customer to draw cheques over and above credit balance in his account. Overdraft is normally allowed to Current Account
Customers and in exceptional case SB A/c holders are also allowed to overdraw their account. The high rate of interest is charged but only on daily debit balance. An
overdraft is repayable on demand. There are two types of overdraft prevalent in Banks i.e. (i) Temporary overdraft or clean overdraft (ii) Secured overdraft. Temporary
overdrafts are allowed purely on personal credit of the party and it is for party to meet some urgent commitments on rare occasions. Allowing a customer to draw against
his cheques sent in clearing also falls under this category. Secured overdraft is allowed up to a certain limit against some tangible security like bank deposits, LIC policies,
National Saving Certificates, shares and other similar assets. Secured overdraft is most popular with traders as lesser operating cost, simple application and document
formalities are involved in this facility.

Cash Credit Account (CC A/C): Cash credit account is a running account just like a current account where debit balance in the account up to a sanctioned limit or drawing