Daily Prelims Notes 26 June 2022
- June 26, 2022
- Posted by: OptimizeIAS Team
- Category: DPN
Daily Prelims Notes
26 June 2022
Table Of Contents
- Gentler sonar
- Guidelines by RBI for Non-bank buy now pay later (BNPL) companies
- Open network for digital commerce
- Spread of Zika Virus
- Kerala to have its own regional red list of birds
- Scientists at the Defense Advanced Research Projects Agency in the United States are working to replace whale-harming sonar with the ambient sounds made by aquatic creatures.
- The low-frequency booms of giant goliath groupers (Epinephelus itajara) and the super-loud snaps of pistol shrimp are among the sounds being considered.
Sonar and Whales
- Active sonar, the transmission equipment used on some ships to assist with navigation, is detrimental to the health and livelihood of some marine animals.
- Research has recently shown that beaked and blue whales are sensitive to mid-frequency active sonar and move rapidly away from the source of the sonar, a response that disrupts their feeding and can cause mass strandings.
- Some marine animals, such as whales and dolphins, use echolocation or “biosonar” systems to locate predators and prey.
- It is conjectured that active sonar transmitters could confuse these animals and interfere with basic biological functions such as feeding and mating.
- The study has shown whales experience decompression sickness, a disease that forces nitrogen into gas bubbles in the tissues and is caused by rapid and prolonged surfacing.
- Although whales were originally thought to be immune to this disease, sonar has been implicated in causing behavioral changes that can lead to decompression sickness.
Section: Monetary Policy
- After slapping curbs on non-bank buy now pay later (BNPL) companies, the Reserve Bank of India (RBI) is likely to come out with guidelines for the BNPL segment which was using pre-paid instruments (PPIs) to extend short-term, interest-free loans to customers for online purchases.
Non-bank buy now pay later (BNPL) segment:
- According to banking observers, the Reserve Bank is not happy with fintech companies using PPIs as a credit instrument, circumventing the regulatory oversight.
- The banking regulator is in discussion with fintech players to find a way out and bring the segment under a regulatory framework so that PPIs are used as a payment instrument and not as a credit avenue.
- While BNPL services have developed into a new payment mode alongside the existing payment modes like cards, UPI and net banking, it has remained outside the direct RBI regulation.
- This channel, facilitated by a few payment aggregators, leverages the existing nodal account (escrow account after authorisation) to route payments between a BNPL customer and a merchant.
- New norms will bring more transparency in the fintech lending space. The main purpose of a PPI licence is to act as a payment instrument and not as a credit instrument.
- The latest regulation is probably coming from recent developments wherein newer business models of credit-based payment products were built by companies using PPI as a vehicle
- The RBI has raised concerns on funding of these PPI instruments through a credit line from an NBFC.
- Regulatory clarity for big tech and fintechs as well as BNPL will really help entities plan long term and invest even more in fintech in India.
- BNPL is India’s fastest-growing online payment method with a significant impact on banks, large merchants and card schemes.
- Due to its hassle-free on-boarding experience, extension of credit facility, low-cost structure for the customer and facilitating easy repayments, BNPL is growing popular among young income earners.
- Some of the popular BNPL companies are LazyPay, Simpl, ZestMoney, Amazon Pay Later, Ola Money Postpaid, Paytm Postpaid, Flexmoney, Slice, UNI and EPayLater.
How does a BNPL company operate?
- A customer who holds a BNPL card or account can make a purchase at a participating retailer and opt for the ‘Buy now, pay later’ option.
- After the purchase, the customer can repay the BNPL firm in a series of interest-free EMIs – unlike credit cards which carry a high interest rate of 42 per cent — spread over 3 months or as a lump sum amount.
- If it remains unpaid, interest will be charged.
- The BNPL company will pay the merchant immediately.
- However, for a purchase of Rs 500, instead of settling the full Rs 500, they would pay something like Rs 470 or Rs 450 and pocket the difference.
- The merchant agrees to give a discount to the BNPL firm.
Section: Indian Economy
- The government of India announced the launch of the pilot phase of open network for digital commerce (ONDC) in five cities with an aim to “democratise” the country’s fast growing digital e-commerce space that is currently dominated by the two U.S.-headquartered ﬁrms — Amazon and Walmart.
What is ONDC?
- As per the strategy paper on ONDC, it is a not-for-proﬁt organisation that will oﬀer a network to enable local digital commerce stores across industries to be discovered and engaged by any network-enabled applications.
- It is neither an aggregator application nor a hosting platform, and all existing digital commerce applications and platforms can voluntarily choose to adopt and be a part of the ONDC network.
- The ONDC aims to enable buying of products from all participating e-commerce platforms by consumers through a single platform.
- Currently, a buyer needs to go to Amazon, for example, to buy a product from a seller on Amazon.
- Under ONDC, it is envisaged that a buyer registered on one participating e-commerce site (for example, Amazon) may purchase goods from a seller on another participating e-commerce site (for example, Flipkart).
- The ONDC model is trying to replicate the success of the Uniﬁed Payments Interface (UPI) in the field of digital payments.
- UPI allows people to send or receive money irrespective of the payment platforms they are registered on.
- The open network concept also extends beyond the retail sector, to any digital commerce domains including wholesale, mobility, food delivery, logistics, travel, urban services, etc.
What is the current status?
- Presently, ONDC is in its pilot stage in five cities — Delhi NCR, Bengaluru, Bhopal, Shillong and Coimbatore — with a target of onboarding around 150 retailers.
- The government has also constituted an advisory council to analyse the potential of ONDC as a concept and to advise the government on measures needed to accelerate its adoption.
What are the likely beneﬁts of ONDC
- The ONDC will standardise operations like cataloguing, inventory management, order management and order fulfillment, hence making it simpler and easier for small businesses to be discoverable over network and conduct business.
- However, experts have pointed out some likely potential issues such as getting enough e-commerce platforms to sign up, along with issues related to customer service and payment integration.
Subject: Science and Technology
Context: Scientists at the National Institute of Virology (NIV), Pune, have raised an alarm about the spread of the Zika virus, along with dengue and chikungunya, in several States and Union Territories where it has never been reported earlier, establishing local transmission in India
Zika virus (ZIKV)
- The Zika virus (ZIKV), a vector-borne flavivirus, is transmitted by the bite of infected Aedes mosquitoes, mainly Aedes aegypti and Aedes albopictus
- It is a contagious disease, infected people can transmit Zika sexually. The incubation period (the time from exposure to symptoms) of Zika virus disease is estimated to be 3-14 days
- It was first identified in Uganda in 1947 in monkeys, Zika was detected in humans five years later.
- Sporadic cases have been reported throughout the world since the 1960s, but the first outbreak happened only in 2007 in the Island of Yap in the Pacific.
- A major outbreak in Brazil led to the revelation that Zika can be associated with microcephaly, a condition in which babies are born with small and underdeveloped brains.
- In India, Zika virus was first recorded in 1952-53. The latest major outbreak was in 2018, when 80 cases were reported in Rajasthan.
- It results involve microcephaly, especially when pregnant women are infected.
- It has been reported a steep increase in Guillain-Barré syndrome — a neurological disorder that could lead to paralysis and death, according to the WHO.
The symptoms of Zika virus
- Most people infected with the virus do not develop symptoms.
- The symptoms are similar to those of flu, including fever body ache, headache etc.
- The symptoms worsen, people should seek medical advice, the occasional rash like in dengue, while some patients also have conjunctivitis.
- Zika virus usually require rest, consumption of plenty of fluids, and common pain and fever medicines
- Zika has no treatment or vaccine.
Context: Kerala will soon have its own red list of birds
- According to the global IUCN red list, Kerala has 35 threatened species of birds. In that, Red-headed vulture and White-rumped vulture are critically endangered. Steppe Eagle, Banasura Chilappan and Nilgiri Chilappan are endangered and 11 species are vulnerable.
- Kerala will soon have its own red list of birds. The Kerala Bird Monitoring Collective led by Kerala Agricultural University and the Bird Count India will conduct the regional red list assessment. Once it gets ready, Kerala will be the first State to have a region-specific red list of birds. Assessment will be done on the basis of the International Union for Conservation of Nature (IUCN) guidelines.
- The IUCN guidelines for preparing the red list have five main criteria. The population size reduction measured over 10 years or three generations is one of the major guidelines. Geographic range on the basis of extent of occurrence or area of occupancy is another. Small population size and decline, very small or restricted population, and quantitative analysis indicating the probability of extinction in the wild are the other criteria.
- The Kerala Bird Atlas accounts for nearly three lakh records of 361 species, including 94 very rare species, 103 rare species, 110 common species, 44 very common species, and 10 most abundant species. According to the atlas, most of the endemics are concentrated in the Western Ghats while the threatened species are cited mostly along the coast.
What is a redlist?
- Established in 1964, the International Union for Conservation of Nature’s Red List of Threatened Species has evolved to become the world’s most comprehensive information source on the global extinction risk status of animal, fungus and plant species.
- The IUCN Red List is a critical indicator of the health of the world’s biodiversity. The IUCN Red List is used by government agencies, wildlife departments, conservation-related non-governmental organisations (NGOs), According to the list, biodiversity is declining. Currently, there are more than 138,300 species on The IUCN Red List, with more than 38,500 species threatened with extinction, including 41% of amphibians, 37% of sharks and rays, 34% of conifers, 33% of reef building corals, 26% of mammals and 14% of birds.