Win 22 lecture series by mrunal patel PDF

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Current affairs lectures by mrunal patel for upsc 2022...

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Mrunal’s Economy Win22 Updates For UPSC & Other Competitive Exams  The advantage of buying Iphone, Oneplus, Nokia or AndroidOne series of phones is they provide (free) operating system updates/security patches for 2-3 years. I believe coaching industry too needs to adopt similar business practice.     � � ��  �� �  �  , � � �   �  , �    � � . ฀฀ ฀฀  So, this ‘Win22 update patch/handout’ is for my old batch students who had joined my economy classes before Feb-2022. It contains updates since the UPSC Prelim-2021 (i.e. October 2021 onwards), including Budget 2022,Economic Survey 2022, and other exam-worthy Economy Current Affairs Updates in Economy. Type of Student

Shd see Win20CSP? Covers updates for UPSC-2020 Shd see Win21CSP? Covers updates for UPSC-2021 Shd see Win22CSP Covers updates for UPSC-2022

Not joined Unacademy Paid course

Before May2019

IF Attended Mrunal’s Full (Paid) Course � � � Between Between Between Between From Jun-2019 Oct-2020 Jul-2021 Oct-2021 Febto Octto Febto Octto FebWeek42020 2021 2021 Week1 2022 (Code: (Code: 2022 onwards PCB2, PCB4) (Code: (Code: PCB3) PCB5) PCB6)

✅ Yes

✅ Yes

� � � No need

� � � No need

� � � No need

� � � No need

� � � No need

✅ Yes

✅ Yes

✅ Yes

✅ Yes

� � � No need

� � � No need

� � � No need

✅ Yes

✅ Yes

✅ Yes

✅ Yes

✅ Yes

✅ Yes

� No � � need

 FAQ1: Do I still need to see Win20- for Win22?: ✅ Yes because in UPSC, they even ask Contemporary issues of economy which are 3 to 5 years old. So, in above column, If there is ✅ tick mark for your column, then u shd see it.  FAQ2: “✋ No need” = means you don’t have to watch that series, because it was taught/embedded within your paid course.

Mrunal’s Economy Win22 Series Pillar#1A1: Money- Digital Payment, Crypto, CBDC → Page 1

10

Contents Pillar1A1: Money, Digital Payments, Bitcoin, CBDC .......................................................................... 3 10.1 10.2

Win20: already covered this in 1A1 (    ) ................................................................. 4 Win21: already covered this in 1A1 (    ) ................................................................. 4

10.3

� � � Digital Payments- RBI’s CPS: PPI also eligible ................................................................. 5 �

10.4

� � � � NPCI: UPI, IMPS, New updates .......................................................................................... 6

10.4.1

� � � � NPCi’s UPI-IMPS- 2 lakh → ⏫5 lakh ........................................................................ 6

10.4.2

� � � � : NPCi’s UPI: International cooperation ........................................................................ 6

10.4.3

� � � � : NPCi's UPMS for bill payment (2022) .......................................................................... 6

10.5

� � � �  PLASTIC Money: New Updates after Win21.................................................................... 7

10.5.1 � � � �MDR: Merchant Discount Rate (��   )............................................................... 7 10.6

� � � �  � � �Card Tokenization (Fake Gmail ID Bnaao Yojana) .................................................. 7 � � � � � � �� � � �  : Offline Retail Payments Using Cards and Mobile Devices ................................. 8

10.6.1

10.7 � � �  � � � �� � �Digital Payment: DBT → E-Rupi by NPCi (2021) ................................................... 8 10.7.1

� � �  � � � �� � �E-Rupi: solves challenges in Physical Procurement/DBT................................ 9

10.7.2

� � �  � � � �� � �E-Rupi: How does it fix Problems in Physical Procurement/DBT?.............. 9

10.7.3

� � �  � � � �� � �E-Rupi: Potential Applications in Future [�� � ] ................................ 10

10.8

� � � �� � � � Digital Payment: New Orgs in News .......................................................................... 11

10.8.1

� � � � � � � �: Post office to get CBS- says � �  � � � � � �Budget-2022 ..................................................11

10.8.2

� � � � � � � �: Digital Payments- (Proposal) Digital Banks by NITI Aayog (2021) ................ 12

10.8.3

� � � � � � � �: Digital Payments- NeoBanks.................................................................................. 12

10.9

�  � � Bitcoin / Crypto-Currency Updates Since Win21 Series ........................................ 12

10.9.1

�  � �:�Hot Wallet vs Cold Wallet................................................................................. 12

10.9.2

�  � �:Crypto-Winter in Bitcoin Prices ( �     ) ....................................... 13

10.9.3

�  � � � � ��El-Salvador: Bitcoin becomes a legal tender (2021) .................................. 13

10.10

�  � �: Bitcoin Profit pe 30% Tax in� �  � � � � � �Budget-2022 .................................................... 13

10.11

�  � �: Bitcoin Purchase pe 1% TDS in� �  � � � � � �Budget-2022 ............................................... 14

10.11.1 10.12

�  � � : Facebook’s Stablecoin Project DIEM/LIBRA sold to another company ... 14

�  ≠� � Non-fungible token (NFT: -  ) ............................................................... 15

10.12.1

(�=� �+� �+� �+� �) Fungibility: Meaning? ................................................................... 15

10.12.2

�  Non-fungible token (NFT: -  ) ................................................................15

10.12.3

�  � � �  NFT-Charms? () ..........................................................................................16

10.12.4

�  � � �  NFT-Challenges: (�) ...................................................................................... 16

10.13

�  � � Blockchain- new updates: DEFI and BalPurskar ..................................................... 16

10.14

� � �  � �� � Central Bank Digital Currency (CBDC).............................................................. 17

Mrunal’s Economy Win22 Series Pillar#1A1: Money- Digital Payment, Crypto, CBDC → Page 2

10.14.1

� � � �� �=� � �� �Benefits of CBDC ( ) ............................................................ 17  �

10.14.2

� � �� �� � CBDC: Bahama’s Sand Dollar & Nigeria’s eNAIRA ................................ 18

10.14.3

� � �� �� � CBDC Challenges: interest rate (� � /�) ................................. 18

10.14.4

� � �� �� �= � � �� � � �Challenges of CBDC ........................................................................ 19

10.14.5

� � �� �� �� � � �CBDC: Conclusion / �� ....................................................................... 19

10.15

�  Digital Payment related Index / Competitions ................................................................ 19

10.15.1

� RBI Digital Payments Index (DPI: �  ) ............................................. 19

10.15.2 10.15.3

18.17.6� � �  �  RBI’s Financial Inclusion Index (��  ) .......................... 20 Harbinger Hackathon 2021............................................................................................... 20

10.16 �  � � � � � � � � � �MRUNAL’S ECONOMY COURSE FOR UPSC PRELIMS & MAINS .................. 20 10.16.1

�  Mock question for Prelims.........................................................................................20

10.16.2

� � �  � � �  � � �1� � � Mock question for Mains/ESSAY ........................................................ 21

10 PILLAR1A1: MONEY, DIGITAL PAYMENTS, BITCOIN, CBDC Mrunal’s six pillars of economy are divided as following  1) MBFIP [money, banking, finance, insurance and pension] o 1A-1: Money: barter, Digital payment, Bitcoin, NFT, CBDC etc. [we are here right now] o 1A-2: RBI’s monetary policy- CRR, SLR, Repo etc o 1B-1: Classification of Banks-NBFC o 1B-2: Burning issues in Banking sector- NPA, IBC, BASEL o 1C: SEBI Sharemarket, Companies Act o 1D: Insurance, Pension, Fin. Inclusion, EPFO, ESCI etc.  2) Budget, taxation GST black money subsidy disinvestment deficit FRBM  3) Intl. Trade, Balance of Payment, WTO, IMF etc,  4) Sectors of Economyo 4A) Agriculture, Dairying, food processing o 4B) manufacturing, services, Ease of doing business, IPR o 4C) GDP, Unemployment, Inflation o 4Z) Microeconomics  5) Infrastructure o 5A) Bijli-Paani-Sadak (Energy water transport) o 5B) Housing, urban, rural, communication, PPP, investment models  6) human resource development (HRD) o 6A) Hunger, Health, IMR, MMR etc o 6B) education, skill, poverty lines & schemes o 6C) weaker section, HDI, SDG

Mrunal’s Economy Win22 Series Pillar#1A1: Money- Digital Payment, Crypto, CBDC → Page 3

10.1 WIN20: ALREADY COVERED THIS IN 1A1฀฀ ฀฀ (     )  💸💸New Coins and Notes  💸💸💸�RBI’s App to help the blind identify currency notes  Budget-2020: A museum for coins  ฀฀ ⏰NEFT becomes free & available 24/7  ฀฀Digital Payment → MDR developments  �฀฀New Umbrella Entity (NUE) for Retail Payments System (2019)  ฀฀฀฀ National Common Mobility Card (NCMC, 2019)  ฀฀฀฀ FASTag for paying toll fees at highways (2017)  �฀฀฀฀ RBI’s Nandan Nilekani Panel (2019: Jan to May)  ฀฀฀฀� Payment and Settlement Systems in India: Vision 2019 – 2021  ฀฀฀฀฀฀ Cryptocurrency & India → RBI ban revoked by SC  ฀฀฀฀ Cryptocurrency & India → ⚖ Banning of Cryptocurrency Bill, 2019  ฀฀฀฀฀฀ Cryptocurrency & world → Stable-coins  ฀฀฀฀฀฀฀฀ Cryptocurrency & world → UNICEF’s Crypto Donation Fund

10.2 WIN21: ALREADY COVERED THIS IN 1A1฀฀ ฀฀ (     )  ฀฀฀฀฀฀ Cheque → Positive Pay Mechanism for Cheques in CTS  💸💸💸💸Next Generation Treasury Application (NGTA), 2020-Oct  QR Codes: compulsory to implement UPI/Bharat QR from 2022  �฀฀฀฀ Perpetual Licence for Payment System Operators?  ฀฀ ฀฀฀฀ Payments Infrastructure Development Fund (PIDF) 2020-Jun  ฀฀ ฀฀ ฀฀ Scheme of Offline Retail Payments Using Cards and Mobile Devices  ฀฀฀฀฀฀ Central Bank Digital Currency (CBDC)  ฀฀💸💸฀฀฀฀ Redenomination: drop zeros, change name  ฀฀💸💸฀฀฀฀ Iran = Toman to replace Iranian Riyal (2020)

Mrunal’s Economy Win22 Series Pillar#1A1: Money- Digital Payment, Crypto, CBDC → Page 4

10.3 💸💸 💸💸 DIGITAL PAYMENTS- RBI’S CPS: PPI ALSO ELIGIBLE

Figure 1: Note: Above chart not 100% legally-technically correct. There may be instances where a Bank’s App may be giving both NEFT & IMPS facility. This chart is meant for simple illustration for MCQ, and NOT for submitting as evidence in some Supreme Court PIL case. ” =avoid this mentality. In short, while reading this handout, “🚩🚩🚩฀฀

RBI's centralised payment systems (CPS)#FAQ1 RBI’s RTGS: Real Time Gross Settlement

� Type

�Target customers � � �

� � � �Target customers

⏰ RBI’s NEFT: National Electronic Funds Transfer � � � �Target customers

💸💸 Transfer Amount

Min ₹2 lakh to ₹2000 crores (SBI).

upto ₹10 lakhs (SBI).

฀฀ Settlement mechanism

฀฀Instant settlement (/  �)

Settles net amount between banks at interval of 30 min.

-

facility?

Immediate Payment Service � � � �Target customers ₹ 1 to max ₹2 lakhs [this limit ⏫ to ₹5 lakh in 2021] ฀฀Instant settlement

24/7 on all days (  � � )

⏰ Timing � Who can provide this

NPCi’s IMPS

-

BEFORE-2021: Only Banks can provide this facility of NEFT & RTGS 2021: RBI announces that non-bank Prepaid Payment Instrument (PPI) can also become members of centralized payment systems (CPS =

Banks + Prepaid Payment Instrument (PPI)/ mobile-wallet companies e.g.

Mrunal’s Economy Win22 Series Pillar#1A1: Money- Digital Payment, Crypto, CBDC → Page 5

RBI's centralised payment systems (CPS)#FAQ1 NEFT & RTGS). So, in future, Amazonpay Wallet etc may also directly allow money transfer via this.

NPCi’s IMPS Amazonpay, Phonepe, Mobikwik

�  Why doesn’t RBI Merge RTGS & NEFT? Ans. RBI may have some technical FAQ1: � �� operational reasons for it. RBI never bothered to disclose it in some big press release or newspaper headline. So I never bothered to do Google search/PHD, because it is an inefficient way of preparing #

for UPSC. Nonetheless, if u feel morally-outraged then Send suggestion to RBI Governor. Until implemented, prepare things as given in handout.

10.4 💸💸 💸💸 NPCI: UPI, IMPS, NEW UPDATES 2008: National Payment Corporation of India(NPCi) is “Not for Profit Company” setup to Provide cost-effective payment solutions / technology for Banks. Some of its famous innovations are:  Immediate Payment Service (IMPS): for transferring money.  Unified Payment Interface (UPI): App development Technology works on on IMPS. E.g. Axispay, SBIBuddy etc.  Bharat Interface for Money (BHIM): NPCi’s own money transfer app based on UPI & IMPS. 10.4.1 💸💸 💸💸 NPCi’s UPI-IMPS- 2 lakh → ⏫5 lakh 2021: Reforms by RBI (using powers of payment and settlement systems act 2007 ) IMPS Daily Money transfer limit UPI Based Mobile Apps: Transaction limit for A) Retail Direct Scheme for investment in G-secs B) Initial Public Offering (IPO) applications

� � �  BEFORE

AFTER � � � 

₹2 lakhs ₹2 lakhs

₹5 lakhs ₹5 lakhs

10.4.2 💸💸 💸💸 💸💸:฀฀฀฀ ฀฀฀฀ NPCi’s UPI: International cooperation  Bhutan became the first country outside India to adopt UPI and its QR code.  India and Singapore joint-project to link UPI with PayNow (Singapore’s money transfer system) → ฀฀ Indian tourists can use BHIM/UPI-walle apps for shopping in Singapore (After converting Rupee into Singapore’s currency online. HOW? NOT.IMP). 10.4.3 💸💸 💸💸 💸💸:⚡⏲ ⚡⏲ NPCi's UPMS for bill payment (2022) 2022-Jan: NPCi ‘s daughter/subsidiary company Bharat BillPay Ltd. (NBBL) Company → launched a Unified Presentment Management System (UPMS) → users can set up standing instructions for auto-debit for their recurring bill payments online e.g. "pay every month's electricity bill from my "X" bank account, automatically."

Mrunal’s Economy Win22 Series Pillar#1A1: Money- Digital Payment, Crypto, CBDC → Page 6

10.5 ฀฀ PLASTIC MONEY: NEW UPDATES AFTER WIN21 Credit & Debit Cards are known as Plastic Money- says NCERT. Here are some new developments: 10.5.1 ฀฀ MDR: Merchant Discount Rate (��   ) MDR is the fees that a merchant must pay to his (acquirer) bank for every card/digital transaction. MDR is also known as Transaction Discount Rate or TDR) ⇒ MDR fees is shared among 3 parties 1) customer’s bank 2) merchant’s acquiring bank 3) payment gateway/service provider (e.g. Visa, Mastercard, Rupay). ( �  �  �    )

Instrument

UPI

MDR % on transaction value

0%

NPCI's Rupay

NPCI's Rupay Credit Card

Debit Card

Mastercard/Visa’s Debit/Debit card etc

0%

“x”% (NOT ZERO)

⇒ ฀฀ So, if a banker promotes Rupay debit card / UPI App → Banker will not earn MDR fees. So bankers promote MasterCard & Visacard to their customers and merchants (instead of Rupay/UPI). (�     �  �     � MDR � �  �) ⇒ So, 2021-Dec: MEITY (Ministry of Electronics & Information Technology) announced up to ₹2,000 MDR Subsidy to Merchant's Bank for RuPay debit cards transactions and UPI transactions.# (   �   �     � MDR    � �� �) ⇒ ฀฀ this will encourage digital payment especially in small towns / rural areas �     � �       ��     � �   UPI     ⇒ ฀฀ Foreign Players like MasterCard and Visacard are opposed to Indian govt’s preferential treatment given to India's Rupay. (  �    �   )  �� � �  FAQ: "I've 500 jaat ke PHD doubts & counter arguments about this MDR subsidy" Ans. Plz waste your time reading egazette.nic.in/WriteReadData/2021/231960.pdf

10.6 ฀฀ ฀฀ CARD TOKENIZATION (FAKE GMAIL ID BNAAO YOJANA)

Figure 2: �    , Identity theft se lagtaa hai!

Mrunal’s Economy Win22 Series Pillar#1A1: Money- Digital Payment, Crypto, CBDC → Page 7

⇒ While doing online-shopping, customer has to enter following data about his credit/debit card: Account Holder’s Name, 16-Digit Account Number, Expiry Date, Security Code (CVV/PIN). ⇒ Often merchant site (e.g. Amazon) offers to store this data in their server so next time customer does not have to retype it and he can do “one click purchase”. ฀฀Challenge? Data may be hacked/leaked/misused. ⇒ Tokenisation = creates a set of numbers called ‘token’ to replace/hide the sensitive card data such as the 16-digit account number, expiry date and security code. (   �     �  /��-         �     � �  � ) ⇒ This ensures your card information is not disclosed to merchant website. ⇒ Card owner can generate Tokenization through visiting card-issuer’s/banker’s website/App through laptops, desktops, tablet, wearables (smartwatch) etc. ⇒ From 1/1/2022, Merchant / Seller can’t store card details. He’ll have to delete previous card data. Only source banks and card issuers (such as Rupay, Visa, and Mastercard) can store card details. However, bankers, card companies wanted more time to upgrade servers/technology, so RBI postponed the norms.      ��     �    �  ,      � �       /       . 10.6.1 ฀฀ ฀฀💸💸 ฀฀💸💸:฀฀ ฀฀ Offline Retail Payments Using Cards and Mobile Devices  While mobile phones, cards, e-wallets, etc. available but, internet connectivity issues especially in rural/remote areas฀฀฀฀(      �   � /� )  2021: RBI allowed offline mode of payments using cards, wallets or mobile devices upto Rs.200 per transaction AND overall limit of Rs 2,000 for all transactions until balance in the account is replenished/recharged. (overall limit is prescribed to prevent big frauds if card/mobile gets stolen. HOW? Ans. 🚩🚩🚩฀฀ James-Bond-girl not important) (        �     . � � - �� �  �          � 2000 �  �            / �  � �      )  ฀฀Benefit? Error-free digital transactions in areas with poor internet connectivity (       �  ...