India Today Headline

RBI To Introduces 4 Bank Transaction Changes In 2023, Limiting UPI To Risk Weights

<p>It’s important to consider the revolutionary changes the Reserve Bank of India (RBI) brought about in the banking industry in 2023 as the new year draws near. The financial environment has undergone some notable changes, indicating a busy year for the RBI.</p>
<p><img decoding=”async” class=”alignnone wp-image-319234″ src=”–750×422.jpg” alt=” rbi to introduces 4 bank transaction changes in 2023 limiting upi to risk weights” width=”1079″ height=”607″ title=”RBI To Introduces 4 Bank Transaction Changes In 2023, Limiting UPI To Risk Weights 3″ srcset=”–750×422.jpg 750w,–1024×576.jpg 1024w,–768×432.jpg 768w,–390×220.jpg 390w,–150×84.jpg 150w, 1280w” sizes=”(max-width: 1079px) 100vw, 1079px” /></p>
<p><strong>Removal of the Rs. 2000 Note</strong></p>
<p>Demonetization of the Rs 2000 note, which the RBI announced on May 19, 2023, was one of the biggest decisions. The central bank offered a four-month opportunity for people to return their Rs 2000 notes, signaling a deliberate change in the dynamics of money, even if the circulation was not immediately stopped.</p>
<p><strong>Higher Risk Ratio for Unsecured Loans</strong></p>
<p>The RBI made a significant adjustment by raising the risk weight on unsecured consumer loans in response to worries over unsecured lending. The percentage of risk assigned to Non-Banking Finance Companies (NBFCs) was increased from 100% to 125%, representing a 25% increase. This preemptive action sought to address the issues brought on by the increase in unsecured loans.</p>
<p><strong>Enhanced Transaction Cap</strong></p>
<p>The RBI increased the Unified Payment Interface (UPI) transaction limit in 2023 in an effort to promote financial inclusion. In particular, the prior maximum of Rs 1 lakh per transaction was significantly surpassed with the rise to Rs 5 lakh for contributions to education and healthcare. The goal of this project was to make financial transactions easier and more substantial, especially in important industries.</p>
<p><strong>No Modification To The Repo Rate</strong></p>
<p>In contrast to prior adjustments, the RBI kept the repo rate at 6.5% for the whole year 2023. The Monetary Policy Committee of the RBI made this decision, which resulted in the repo rate being steady for the fifth time in a row. There hasn’t been a repo rate increase since February 2023. An important instrument in monetary policy, the repo rate has a significant impact on both borrowing rates and general economic circumstances.</p>
<p>The RBI’s dedication to adjusting to changing economic conditions and promoting financial stability in the banking industry is shown by these calculated actions.</p>

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