RBI Prepares Scheme For PMC, Unity Small – Latest news headlines


RBI has prepared a draft plan for PMC Bank’s amalgamation with Unity Small Finance Bank

Reserve Bank of India (RBI) on Monday unveiled a draft scheme for amalgamation of the troubled Punjab and Maharashtra Cooperative Bank (PMC) and Unity Small Finance bank (USFB).

The draft plan proposes USFB taking over the assets and liabilities of PMC Bank including deposits, which would provide a greater degree of protection to depositors.

RBI has sought suggestions or objections, if any, from depositors, members and creditors of PMC Bank as well as of USFB on the scheme by December 10, 2021. After the expiry of the deadline, the central bank will take a final call on the matter.

The plan has been put up on the central bank’s website.

The RBI further said that “USFB is being set up with capital of about Rs 1,100 crore as against a regulatory requirement of Rs 200 crore for setting up of a small finance bank under the guidelines for on-tap licensing of small finance bank in private sector dated December 5, 2019, with provision for further infusion of capital at a future date after amalgamation”.

Maharashtra-based PMC Bank was placed under business restrictions with effect from September 23, 2019, on account of fraud, which led to steep deterioration in the net worth of the bank.

The directions were last extended through a June 25, 2021 directive up to December 31, 2021.

“Given the financial condition of the PMC Bank and in the absence of proposals for capital infusion, the bank was not viable on its own. In that event, the only course of action could have been cancellation of its licence and taking it for liquidation, wherein depositors would have received payment up to the insurance ceiling of Rs 5 lakh,” the RBI said.

Keeping in mind the interest of its depositors, the amalgamation scheme has been unveiled, which would provide them protection, the central bank said.



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Latest News Today – Centre Introduces Bill To Help Pandemic-Hit Small


Government has introduced a bill to provide relief to pandemic hit small and medium enterprises

The Centre on Monday introduced a bill in Lok Sabha for providing a resolution process for financially stressed micro, small and medium enterprises (MSMEs), especially those which have been affected by the Coronavirus pandemic.

The bill will amend the insolvency law and offer what is being termed, a pre-packaged resolution process for such small enterprises.

The proposed amendments would help notify the threshold of a default not exceeding Rs 1 crore for initiation of pre-packaged resolution process. The Centre has already prescribed the threshold of Rs 10 lakh for this purpose.

The Insolvency and Bankruptcy Code (Amendment) Bill, 2021, which was introduced by Finance Minister Nirmala Sitharaman, will replace the ordinance that came into effect on April 4, 2021 to provide relief for pandemic affected MSMEs.

The bill seeks to have a new chapter in the Code to facilitate pre-packaged insolvency resolution process for corporate persons that are MSMEs.

Under a pre-packaged process, main stakeholders such as creditors and shareholders come together to identify a prospective buyer and negotiate a resolution plan before approaching the National Company Law Tribunal (NCLT). All resolution plans under the Insolvency and Bankruptcy Code (IBC) need the tribunal’s approval. 

As per the bill’s objective, it aims to specify a minimum threshold of not more than Rs 1 crore for initiating pre-packaged insolvency resolution process as well as provisions for disposal of simultaneous applications for initiation of insolvency resolution process and pre-packaged insolvency resolution process, pending against the same corporate debtor.

There would be a penalty for fraudulent or malicious initiation of pre-packaged insolvency resolution process or with intent to defraud persons, and for fraudulent management of the corporate debtor during the process.

Further, punishment would be meted out for offences related to pre-packaged insolvency resolution process.



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Latest News Today – Many People Dead After Small Plane Crashes In Sweden:


The aircraft was located alongside one of the runways, an official said. (Representational)

Stockholm, Sweden:

Several people have died after a small aircraft used for skydiving with nine people on board crashed near an airport outside Orebro in Sweden on Thursday, police and rescue services said.

A small propeller plane crashed near Orebro airport, about 160 kilometres (100 miles) west of Stockholm, according to an alert received by Sweden’s Joint Rescue Co-ordination Centre (JRCC)

They located the aircraft alongside one of the runways, Carl-Johan Linde, spokesman for the Swedish Maritime Authority which oversees the JRCC, told AFP.

As far as they could tell, the accident happened as the plane was taking off, he added. Nine people were reported to be on board: eight skydivers and the pilot.

Lars Hedelin, spokesman for the Bergslagen region police referred to “multiple” deaths. While he would not give a specific figure, he did say that one person had been taken to hospital with serious injuries.

In 2019, nine people were killed when a plane carrying skydivers crashed outside the city of Umea, northeast Sweden.

(Except for the headline, this story has not been edited by NDTV staff and is published from a syndicated feed.)



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Latest News Today – Government Runs Many Schemes For Small And Medium Units.


Government runs several schemes for boosting small and medium enterprises

The Government has launched several schemes to boost the micro, small and medium enterprises (MSME) sector as it is a major component towards driving employment generation. The main focus of the Centre in terms of providing employment opportunities in this sector are the youth and women.

Let’s have a look at some of the key schemes started by the Government to boost the MSME sector, which is also considered the backbone of Indian economy.

Udyog Aadhaar Memorandum

Aadhaar card is a 12 digit number given to every Indian by the Government. Under this initiative, it is a mandatory requirement. This scheme was launched with the aim of providing ease of doing business in the MSME sector and streamlining the process of registration of small units, by universalising the procedure.

The benefit of registering in this scheme is the ease in availing credit, loans, and subsidies from the government. Registration can be done both ways in the online mode as well as through the offline mode.

Zero Defect Zero Effect

In this scheme, products or goods that are manufactured for export have to conform to a particular standard so that they are not rejected or sent back to India. To achieve this objective, the Government conceptualised this scheme. In this, the exported goods are also eligible for some rebates and concessions.

Quality Management Standards And Quality Technology Tools

Once registered in this scheme, it helps small enterprises to understand and implement the quality standards that are required to be maintained along with new technological requirements. In this scheme, activities are conducted to sensitise the businesses about the new technology available through various means of communication and publicity.

Grievance Monitoring System

In this mechanism, business owners can get their grievances addressed and can also check the status of their complaints and can even get them reopened, if they are not satisfied with the solution.

Incubation

This scheme helps innovators in implementing their new design, ideas or products. Government finances up to 80 per cent of the project cost.

Credit Linked Capital Subsidy Scheme

Under this scheme, new technologies are provided to business owners to replace their old and obsolete technical knowhows. Capital subsidy is given to businesses to help them upgrade and have better means to do their business. MSMEs can also directly approach the banks for these subsidies.

Women Entrepreneurship

This scheme is especially meant for women who want to start their own business. The Government provides capital, counselling, training and delivery techniques to these women so that they can manage their business and expand it.



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Latest News Today – June 27 Is Micro, Small And Medium Enterprises Day. Read


June 27 every year is observed as Micro Small and Medium Enterprises Day

The United Nations General Assembly (UNGA) during its 74th Plenary session held on April 6, 2017 declared June 27 as Micro, Small and Medium Enterprises or MSME Day, underlining the significance of the sector, especially in achieving the sustainable development goals (SDGs).

What are Micro Small and Medium Enterprises?

Any business unit where there are less than 10 employees and its annual turnover is not more than Rs 25 lakh, is called a micro enterprise. 

A small enterprise is one where there are less than 50 employees and the investment in plant and machinery is more than Rs 25 lakh but does not exceed Rs 5 crore.

A medium enterprise is an establishment where the investment in plant and machinery is more than Rs 5 crore but does not exceed Rs 10 crore. Also the number of employees in such a unit should be less than 250.

The definition of an MSME depends on several factors like nature of business, socio-economic structure of the particular country and the country’s population.

These enterprises play an important role in providing employment opportunities to people, especially in developing countries. They also help in poverty alleviation and give a thrust to development and help in employment of women and youth.

How do they help in achieving Sustainable Development Goals?

MSMEs through innovation and creativity help in achieving (SDGs). SDG targets 8.3 and 9.3 call for enhancing the access of MSMEs to financial services. In addition to this, SMEs are an important element in the implementation of SDG 8 (decent work and economic growth) and SDG 9 (industry, innovation and infrastructure.



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SoftBank Latin America Fund Leads $28 Million Atom Finance | Sidnaz Blog


SoftBank Group Corp.


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is investing in startup investing platform Atom Finance, in a bet by the Japanese conglomerate that a retail trading boom is here to stay.

Atom Finance, founded in 2018, lets individuals track investments and research holdings. In addition to SoftBank, existing investors General Catalyst and Base Partners also took part in the latest $28 million funding round. The investment values Atom at around $150 million, said a person familiar with the matter.

Atom was founded by

Eric Shoykhet,

who covered financial services firms and other sectors from 2015 to 2018 at hedge fund Governors Lane. He believed falling trading costs would prompt more individual investors to trade. This meant that they would need new kinds of tools to guide them.

‘The narrative we never bought into was that active investing was dead,’ said Atom Finance founder Eric Shoykhet.



Photo:

Atom Finance

In 2019, major brokerages launched no-commission stock trading to stave off the threat from digital upstart Robinhood Markets Inc. Now, all kinds of brokerages compete against each other for retail traders with free trading having become a booming business. It has been particularly transformative in the past year as more investors with free time during the pandemic have wielded growing power over markets, sending meme stocks such as

GameStop Corp.

soaring.

Atom isn’t a trading platform but it has still been a beneficiary. Hundreds of thousands of users have signed up since its platform launched in 2019. Paying customers increased in the past year, though the firm declined to provide exact details about user numbers.

“We think a lot of that increase in investor participation in markets is here to stay,” said Mr. Shoykhet, 29 years old. “The narrative we never bought into was that active investing was dead.”

Mr. Shoykhet hopes his firm will grow as individuals seek cheap tools to help them invest. A full Atom subscription goes for $9.99 a month, a fraction of how much a Bloomberg Terminal costs.

Atom also plans to license its product to banks and brokerages.

SoftBank led the Series B funding round in Atom through a $5 billion fund it created to focus on Latin America. It reflects SoftBank’s wager that the rise of individuals in U.S. markets will take off in that region too.

This year, Atom pursued a deal on its own to provide products for Banco Inter, a digital bank in Brazil that SoftBank’s Latin America fund has also invested in.

Shu Nyatta,

managing partner for SoftBank’s Latin America fund, said SoftBank later introduced Atom to other portfolio companies in hopes of fueling similar deals.

“The whole idea is to bring high-quality data to people who wouldn’t have access to them,” he said.

Mr. Nyatta said he was drawn to Mr. Shoykhet’s opportunism and willingness to make Latin America a strategic focus. Mr. Shoykhet recently moved to Miami and is planning to open an office there, in part to make it easier to do business with Latin America.

But there is one thing Atom Finance isn’t planning to do for now: It doesn’t want to become a trading application.

Mr. Shoykhet is skeptical about many e-brokerages’ practice of routing trades to big trading firms in exchange for payments. The industry has defended this practice, known as payment for order flow, arguing that it lowers the cost of trading for individuals. Others argue it hurts investors as firms will encourage heavy trading by users to maximize profits—even if those investors take too much risk.

“We don’t think it has users’ best interests in mind,” he said.

Write to Dawn Lim at [email protected]

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Facebook and Its Advertisers Feel Pinch of Apple’s Privacy Drive | Sidnaz Blog


Advertising relationships are often about the people who foster them. But when you are as big as

Facebook,


FB -0.36%

relationships are about money.

On Wednesday, Facebook’s head of global advertising sales

Carolyn Everson

said she was leaving the company after more than a decade. Just a few months ago, Facebook’s revenue chief

David Fischer

said in a Facebook post that he would be leaving the company later this year.

These exits have led some to worry about the impact on Facebook’s advertiser relationships. Last year, for example, Ms. Everson played a big role keeping major advertisers on Facebook’s platform, despite civil rights-related boycotts of the social network, The Wall Street Journal reported.

Such relationships may be irreplaceable at a smaller company, but are perhaps less important to a platform as large as Facebook. Its legacy Blue app alone is used by roughly 36% of the world’s population monthly, while its broader family of apps are used by nearly 44%. That number of eyes has no equal.

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Which company do you think is better positioned in the long term, Facebook or Apple? Join the conversation below.

The departures come at a particularly delicate time, though. Apple’s recent iOS operating system changes require developers to request users’ permission to track their online activity, a key way Facebook and other ad-based platforms were able to collect information about users in order to target them with ads. Facebook has been outspoken about its concern that tracking changes will disproportionately affect small businesses. That makes sense: As of the third quarter of last year, Facebook said it had over 10 million active advertisers on its platform, most of which were small businesses. Chief Executive

Mark Zuckerberg

has also said that as a business, he believes Facebook can manage through the changes and that it may emerge even stronger if it becomes harder for small businesses to navigate data targeting without Facebook’s help.

Facebook doesn’t regularly disclose the percentage of revenue that comes from small businesses, but investors got a hint of the proportion last year, when boycotts from large, well-known brands like

Verizon Communications,

VF Corp.’s

North Face and

Coca-Cola

had little effect on its top-line performance. Because Facebook has historically offered small businesses a virtually unmatched return on their investment, these companies have little choice but to advertise on its platforms.

Recent iOS changes could threaten some of Facebook’s loyalty among small businesses.



Photo:

Christoph Dernbach/Zuma Press

But the recent iOS changes could threaten some of that loyalty. Caitlin Tormey Mongiardini, chief commercial officer of cashmere clothing company NAADAM, said her company recently reallocated some of its marketing budget to focus on brand partnerships and other strategic marketing areas outside Facebook after hearing that the iOS update had been negatively affecting its peers. In some cases, she said fellow direct-to-consumer brands have seen their return on investment on Facebook cut in half.

Will Matalene, paid platform expert and digital marketing consultant, points out that in addition to diminished ad targeting abilities, Facebook is also now getting less data from Apple, making it more difficult for the platform to demonstrate returns to clients.

Ultimately, brands that have historically allocated large, set portions of their budgets to Facebook are becoming more nimble in terms of advertising channels, he said. While he doesn’t expect any brand can afford to pull all their money out from Facebook’s reach, he does see brands diversifying away from the company until it can come up with new ways to bolster its value proposition amid heightened focus on user privacy.

Facebook has said it expects iOS changes to begin to have an impact on its business in the current quarter. It is forecasting second-quarter year over year revenue growth to remain stable or modestly accelerate from the monster 48% growth it put up in the first quarter, but for growth rates to “significantly decelerate” sequentially in the third and fourth quarters.

Despite some advertisers reporting lower returns on their investments, pricing on Facebook’s ads has been rising. The company said on its first-quarter conference call that its average price per ad in the first quarter increased 30% year-on-year, even as impression growth has eased lately as last year’s homebound consumers are stepping back out. It expects ad revenue growth to be primarily driven by price for the remainder of the year.

To continue justifying rising prices in the face of a potentially lowered value proposition, Facebook will likely need a new game plan. The departure of two key ad executives only underscores that big changes could be afoot.

To Facebook’s advertisers and investors, the only faces that really matter are Benjamin Franklin’s rolling in.

Write to Laura Forman at [email protected]

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Digital-Security Startup Backed by Katzenberg Valued at Over $1 | Sidnaz Blog


Aura, a company backed by Hollywood mogul

Jeffrey Katzenberg

and Silicon Valley investor Sujay Jaswa, raised $150 million to help further its bid to become a one-stop offering for online security.

The funding round, led by private-equity firm Warburg Pincus LLC, brings the company’s war chest to $450 million and values the company at more than $1 billion, Aura officials said.

Aura this week is rolling out an all-in-one digital-security product that includes antivirus and identity-protection software for consumers, and the company plans to launch an advertising campaign later this year. Previously it offered different products for various digital-security threats. Many of those products came through acquisitions.

Aura has attracted the backing of the Hollywood mogul Jeffrey Katzenberg.



Photo:

Steve Marcus/Reuters

Aura is on track to generate roughly $220 million in revenue in 2021 from more than 1.7 million customers world-wide and is profitable, the officials said.

“Everything we’ve done up until now was to put together the rocket ship,” Mr. Katzenberg, who recently joined Aura’s board, said in an interview. “This investment is the rocket fuel to make it the safety product for consumers around the globe.”

Messrs. Katzenberg and Jaswa’s WndrCo has been a significant backer of Aura, and Mr. Jaswa is chairman of Aura. Venture-capital firm General Catalyst has previously invested in the company.

It was originally founded as iSubscribed in 2017 and changed its name to Aura in 2019 to unite all of its brands. Acquisitions include Intersections, Pango, FigLeaf and PrivacyMate.

Hari Ravichandran, Aura’s CEO, says he plans to focus more on organic growth.



Photo:

Aura

Aura’s founder and chief executive,

Hari Ravichandran,

said acquisitions have been critical to the company’s growth, helping it build out a suite of products that addresses different points at which consumers face challenges protecting digital security. “There’s a breadth of what we aspire to cover,” he said, adding that Aura will now focus more on expanding its products and customers organically.

Mr. Ravichandran said that he expects Aura to become a publicly traded company but that it is at least a year away from staging an initial public offering.

“My perspective on this is that the public ecosystem is the best for scale in the longer term,” he said. “We have a desire to be a great independent company, but not get into the public ecosystem too soon.”

Write to Maureen Farrell at [email protected]

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Lordstown Motors Amends Annual Filing With Going Concern Notice | Sidnaz Blog


Lordstown Motors headquarters in Ohio.



Photo:

Dustin Franz/Bloomberg News

Electric-truck startup

Lordstown Motors Corp.


RIDE -16.27%

disclosed in a new regulatory filing Tuesday that it doesn’t have sufficient cash to start commercial production and has doubts about whether it can continue as a going concern through the end of the year.

The company amended its annual report to include the going-concern notice, which can flag survival problems for businesses within the next 12 months. The warning comes as new challenges emerge for the two-year-old company that is trying to convert a former

General Motors Co.

plant in Ohio to produce electric pickup trucks. It has said its first model, the Endurance, will start production in September.

Lordstown Motors Chief Executive

Steve Burns

said on a call with analysts in late May that the startup would need to raise more capital to hit its target of building 2,200 pickup trucks by year-end. The company said at the time that higher-than-expected costs were accelerating its cash burn and that it would finish the year with between $50 million and $75 million on hand.

The company was among a number of new electric-vehicle startups that went public last year through reverse mergers with special-purpose acquisition companies, or SPACs. Lordstown raised $675 million from its reverse merger last fall, a deal that valued the aspiring truck maker at about $1.6 billion.

The company didn’t immediately respond to requests for comment.

More to come…

Write to Ben Foldy at [email protected]

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