Ans: Presently market risk capital charge for Government Securities is calculated using Standardized Duration Method. This method is based on the price sensitivity with respect to nominal interest rates (modified duration). This methodology may be made applicable to IIBs also. Nominal interest rates are composed of two factors: real interest rates and inflation expectations. IIBs are exposed to the risk of changes in the real rates only. Therefore, price sensitivity calculated with respect to nominal yields will not provide the true risk of the IIBs. Hence in the case of IIBs, price sensitivity with respect to change in the real yields should be calculated for IIBs.

Ans. Yes. All compounding applications shall be submitted along with the prescribed fee of ₹10,000/- (plus applicable GST, which at present is 18%) by way of demand draft in favour of “Reserve Bank of India” and payable at the concerned Regional Office/ CO Cell, New Delhi/ Central Office or through National Electronic Fund Transfer (NEFT), or other permissible electronic or online modes of payment. The necessary details for making the payment through electronic mode is provided in Annexure I in Directions – Compounding of contraventions under FEMA, 1999. In case application fee is paid through NEFT or other permissible electronic mode of payment, it may be ensured that intimation of payment of applications fee, to respective RO, CO Cell, or Central Office, as case may be, shall be made as soon as possible but not later than 2 hours from time of payment, through an email as per the template provided in Para B of Annexure I of Directions – Compounding of contraventions under FEMA, 1999.

It may further be noted that in case compounding application is returned for any reason, The application fee, if paid, shall not be returned in case of return of the compounding application. However, in case such applications are re-submitted, then the application fee need not be paid again.

Answer: An NRO (current/ savings) account can be opened by a foreign national of non-Indian origin visiting India, with funds remitted from outside India through banking channel or by sale of foreign exchange brought by him to India. The balance in the NRO account may be paid to the account holder at the time of his departure from India provided the account has been maintained for a period not exceeding six months and the account has not been credited with any local funds, other than interest accrued thereon.

Ans: Yes, the intent of the circular is to allow flexibility to the customer to switch from floating rate loan to fixed rate loan or vice versa subject to applicable charges. The RE is required to specify the number of times a borrower will be allowed to exercise the switch option during the tenor of the loan under its Board approved policy.

Ans: e₹ wallet is available and supported both on Android and iOS mobile devices.

In terms of para 3(i) of the circular, the prescribed guidelines will not affect the normal procedures for compounding of interest in the loan account. Therefore, REs may charge interest on unpaid interest (including on unpaid EMI) at the contracted rate of interest till the date of remediation, and not at the penal rate of interest.

Ans. No. In terms of paragraph 9.1.6 of these Directions, the benefit of additional interest on term deposits held by bank’s staff member/ retired staff member singly or jointly with family members is only available where the staff member/ retired staff member is the principal account holder.

A Deputy Ombudsman is a senior officer appointed by RBI to assist the RBI Ombudsman (refer Question 4) in matters of resolution of complaints and in handling certain complaints and the functions entrusted under the Scheme. The Deputy Ombudsman endeavors to promote settlement of a complaint by agreement between the complainant and the RE through facilitation or conciliation or mediation and dispose complaints as discussed in Question 24.