Source: BS Context: Following the nil GST on individual life and health insurance premiums announced by the GST Council, life insurers face a financial impact due to the removal of Input Tax Credit (ITC). The Life Insurance Council, representing insurers, plans to approach IRDAI to pass part of this burden to distributors by reducing commissions. Rationale: GST & ITC Background Input Tax Credit (ITC) Input Tax Credit (ITC) allows businesses to reduce the tax they have paid on inputs (goods or services purchased) from the tax they are required to pay on their outward supplies (sales). In simple terms, ITC ensures that tax is levied only on the value addition at each stage, preventing tax-on-tax (cascading effect). Example: If an insurer pays GST on services like agent commissions, office rent, or IT systems, they can normally claim credit for this GST against their output GST liability. ITC Implications:

Context: National Pension System (NPS) Key Features: Pros: Cons: Unified Pension Scheme (UPS) Key Features: Pros: Cons: Eligibility & Switching Rules Tax Treatment Scheme Employee Contribution Employer Contribution Withdrawals Pension Taxability NPS Deduction under 80CCD(1) Government: 80CCD(2) 60% tax-free; rest used for annuity Taxable as income (annuity portion) UPS Same as NPS Same as NPS 60% similar; excess taxed as salary Pension taxable as income Which One to Choose? Factor NPS UPS Risk Appetite High, can handle market volatility Low, prefers guaranteed income Returns Potentially higher, market-linked Fixed, predictable, inflation-linked Flexibility High, investment allocation control Low, fixed benefits Suitability Younger employees, long investment horizon Risk-averse, nearing retirement, prefer certainty

Source: ET Context: Domestic carrier IndiGo on Thursday announced the launch of a co-branded premium credit card in collaboration with SBI Card, offering a host of benefits to the customers of the two companies. Program: Part of IndiGo BluChip loyalty program Card Variants: Platform Availability:

Source: FE Context: The National Pension System (NPS), which became available for the non-government sector in 2009, has evolved over the last 16 years, and today it is considered one of the most reliable retirement investment options. Objective: Reduce rigidity, expand investor choice, and make NPS more appealing, especially to private-sector employees and optional subscribers. Major Reforms: Benefits: Challenges / Tax Wrinkles:

Context: India Bullion & Jewellers Association (IBJA) urges regulators to allow Indian-refined gold and silver bars (“India Good Delivery”) for: About MCX Current Scenario: Gold & Silver ETFs in India What are ETFs? Gold ETFs Silver ETFs

Source: Mint Context: NaBFID (National Bank for Financing Infrastructure and Development) is collaborating with the World Bank and Asian Development Bank (ADB) to set up a $1 billion risk-sharing facility. Purpose of Facility: Regulatory Context: Strategic Importance:

Source: TOI Context: RBI has directed Bengaluru-based BNPL firm Simpl to shut its payments operations immediately. Reason: Operating a payment system without RBI authorisation, which violates the Payment and Settlement Systems Act, 2007. Background on BNPL Regulation BNPL (Buy-Now-Pay-Later) BNPL is a financial service that allows consumers to purchase goods or services immediately and pay for them in instalments over time, often without interest for a short period. How it works RBI Important Acts for BNPL Regulation / Act Applicability to BNPL Providers Reserve Bank of India Act, 1934 Grants RBI authority to regulate both banking and non-banking financial institutions. Banking Regulation Act, 1949 Applicable if the BNPL provider functions as a bank. NBFC Regulations Applicable if the BNPL provider operates as an NBFC: • RBI (NBFC) Directions • Digital Lending Guidelines, 2022 (under RBI supervisory powers over NBFCs and digital lenders). Payment and Settlement Systems Act, 2007 Applicable if the BNPL provider issues prepaid payment instruments (PPIs).

Context: India’s financial system is witnessing a gradual yet profound transformation. While banks remain central to credit delivery, non-bank financial channels — including NBFCs, corporate bonds, equity, and foreign capital — are playing an increasingly important role. Regulatory reforms, digital infrastructure, and evolving borrower preferences are accelerating this shift. The Role of NBFCs: Category Details / Examples Lending Growth – NBFC loans reached ₹6.1 lakh crore (20% YoY increase). – Crucial for MSMEs, semi-urban, and underserved segments. Key Advantages – Flexible product design and repayment terms. – Strong local presence and contextual understanding. – Use of alternative data and AI for thin-file customers. – Digital channels enable faster, tailored lending. Funding Diversification – Access to corporate bonds, securitisation, co-lending partnerships, and external borrowings. – Innovations include first-loss default guarantees, API-led digital co-lending, and retail participation in loan pools. Regulatory Support – Rollback of higher risk weights on bank lending to NBFCs lowered borrowing costs. – Enabled competitive expansion of lending portfolios. Forward-Looking Reforms and Embedded Finance: Implications for the Financial System: