CURRENT AFFAIRS

Detailed explanation-1: -The Reserve Bank raised the minimum capital requirement for setting up an asset reconstruction company (ARC) to Rs 300 crore from the existing Rs 100 crore with an aim to strengthen the securitisation sector which plays a vital role in the management of distressed financial assets.

Detailed explanation-2: -RBI now said that ARCs with minimum net owned fund of Rs 1000 crore can undertake act as resolution applicants. In general, the regulator has also asked all ARCs to raise their minimum net-owned fund to in a phased manner – Rs 200 crore by end-March 2024 and Rs 300 crore by end-March 2026.

Detailed explanation-3: -200 Cr. The minimum capital for Small Finance is prescribed at Rs. 200 crore .

Detailed explanation-4: -The scheduled banks are those banks that are listed in the second schedule of the RBI Act 1934. But a bank needs to have a paid-up capital and raised funds of at least Rs. 5 lakh to be eligible as a scheduled bank.

Detailed explanation-5: -The minimum initial capital requirement for licensing new banks should be enhanced from ₹500 crore to ₹1000 crore for universal banks, and from ₹200 crore to ₹300 crore for small finance banks.