Banking Awareness

1.Who was the first Governor of the Reserve of ? [A] Sir James Taylor [B] Sir Vincent Eyre [C] Sir Osborne Smith [D] Reginald Macdonald Answer Correct Answer: C [ Sir Osborne Smith ] ​ Notes: Sir Osborne Smith was the first Governor of the Reserve Bank. A professional banker, he served for over 20 years with the Bank of New South Wales and 10 years with the Commonwealth Bank of Australia before coming to India in 1926 as a Managing Governor of the Imperial .

2.UIDAI is a statutory authority formed under which of the following ? [A] Niti Aayog [B] Home Ministry [C] Ministry of Communication and Information Technology [D] Ministry of Statistics and Programme Implementation Answer Correct Answer: C [Ministry of Communication and Information Technology] Notes: The Unique Identification Authority of India is a central government agency of India under the ministry of communication and information technology India. It was set up by the Government of India on 28 January 2009 .The UIDAI is under the administrative control of the ministry of communication and information technology. 3.KYC guidelines have been issued under which section of Banking Regulation ACT 1949? [A] Section 35 A [B] Section 45 [C] SECTION 36 A [D] Section 123 B Answer Correct Answer: A [Section 35 A] ​ Notes: KYC guidelines were issued under Section 35 A of the Banking Regulation Act, 1949.These were introduced in year 2002 by RBI and all were asked to make all accounts KYC compliant by 31 December 2005.Banks are also required to periodically update their customers’ KYC details.

4.Which of the following is not the type of credit reporting institutions? [A] Credit Bureau [B] Credit Agencies [C] Both a and b [D] None of the above Answer Correct Answer: C [Both a and b] ​ Notes: There are two types of Credit Reporting Institutions. These are Credit Bureau and Credit Registry. Credit Registries tend to be public entities. They are usually managed by central banks or bank supervision agencies. In contrast, Credit Bureaus tend to be privately owned and privately operated companies.

5.According to FERA ,Foreign Exchange includes which of the following? [A] Traveler’s Cheque [B] Letters of Credit [C] Bill of Exchange expressed or drawn in Indian Currency [D] All of the above Answer Correct Answer: D [All of the above] ​ Notes: According to FERA ,1973 Foreign Exchange means Foreign Currency, which includes: Any Draft Traveller’s Cheque Letters of Credit Bill of Exchange expressed in Indian Currency but payable in Foreign Currency

6.What is the full form of MDER? [A] Market Determined Exchange Rate [B] Market Derivative Exchange Rate [C] Market Determined Exchange Regime [D] Managed Determined Exchange Rate Answer Correct Answer: A [Market Determined Exchange Rate] ​ Notes: After 1999 the official rate was discontinued and the exchange rate became market-determined exchange rate (MDER). Under MDER the forces of demand and supply of dollars in India determine the exchange rate.

7.Who are authorized to sell Foreign Exchange in India? [A] Authorized Dealers [B] RBI [C] FFMCs [D] Both a and c Answer Correct Answer: D [Both a and c] ​ Notes: Foreign exchange can be purchased from any authorized person, such as an AD Category-I bank and AD Category II. Full-Fledged Money Changers (FFMCs) are also permitted to release Foreign exchanges.

8.Who is the current head of Central Registry of Securitization Asset Reconstruction and Security Interest (CERSAI) ? [A] Praveen Kumar Sharma [B] Naveen Kumar Sharma [C] Laxmi Niwas Mittal [D] Nandan Nilekani Answer Correct Answer: A [Praveen Kumar Sharma] ​ Notes: CERSAI is a central online security interest registry of India. It was primarily created to check frauds in lending against equitable mortgages, in which people would take multiple loans on the same asset from different banks. It was founded on march 11,2011 and is headed by Praveen Kumar Sharma.

9.Where does the headquarters of Brickwork Ratings India Private Limited situated? [A] Bangalore [B] Hyderabad [C] Mumbai [D] New Delhi Answer Correct Answer: A [Bangalore] ​ Notes: Brickwork Ratings India Private Limited is headquartered in Bangalore. This credit rating agency is responsible to rate bank loans, municipal corporation, capital market instrument and SMEs.

10.Personal Loans are also called as by which of the following names? [A] Signature Loans [B] Unsecured Loans [C] Consumer Loans [D] All of the Above Answer Correct Answer: D [All of the Above] ​ Notes: Unsecured loans (called signature loans) are advanced on the basis of the borrower’s credit-history and ability to repay the loan from personal income. Repayment is usually through fixed amount installments over a fixed term. Also called consumer loan.

11.Which type of Fund is required to be listed on Stock Exchange? [A] Debit Fund [B] Liquid Fund [C] Close Ended Funds [D] Sector Funds Answer Correct Answer: C [Close Ended Funds] ​ Notes: A closed-end fund is organized as a publicly traded investment company by the Securities and Exchange Commission. Like a mutual fund, a closed-end fund is a pooled investment fund and raises a fixed amount of capital through an initial public offering (IPO). The fund is then structured, listed and traded like a stock on a stock exchange.

12.What type of loan is a Housing loan? [A] Unsecured Loan [B] Secured Loan [C] Corporate Loan [D] Consumer Loan Answer Correct Answer: B [Secured Loan] ​ Notes: Housing loan is a secured loan that is backed by an asset or equipment. The asset is called collateral. This collateral is needed because the amount of loan in the case of secured loan is much higher.

13.What is an amortization schedule? [A] It is a table that gives details of the periodic principal and interest payments on a loan and the [B] It is convenient for borrowers who are in the beginning of their careers. [C] It is the schedule at which commercial banks charge their customers who are most creditworthy. [D] All of the Above Answer Correct Answer: A [It is a table that gives details of the periodic principal and interest payments on a loan and the] Notes: Amortization schedule is a table that gives details of the periodic principal and interest payments on a loan and the amount outstanding at any point of time. It also shows the gradual decrease of the loan balance until it reaches zero.

14.On how much amount of interest repayment ,an income tax rebate is available in India? [A] 1.5 lakh per annum [B] 2 lakh per annum [C] 3 lakh per annum [D] 2.5 lakh per annum Answer Correct Answer: A [1.5 lakh per annum] ​ Notes: Resident Indians are eligible for certain tax benefits on both principal and interest components of a loan under the Income Tax Act, 1961. Under the current laws, one is entitled to an income tax rebate for interest repayment up to Rs. 1,50,000 /- per annum.

15. is wholly owned by which of the following institutions? [A] RBI [B] SEBI [C] SBI [D] None of the Above Answer Correct Answer: A [RBI] ​ Notes: NHB is wholly owned by , which contributed the entire paid-up capital. The Head Office of NHB is at New Delhi. NHB was set up on July 9, 1988 under the National Housing Bank Act, 1987.

16.Which of the following institute is the regulator of the housing finance in India? [A] RBI [B] CIBIL [C] SEBI [D] NHB Answer Correct Answer: D [NHB] ​ Notes: National Housing Bank is the Housing finance regulator in India. The main aim of NHB is to promote a sound, healthy, viable and cost effective housing finance system to cater to all segments of the population and to integrate the housing finance system with the overall financial system.

17.Which of the following civilization is considered to be the origin of Factoring? [A] Indus Valley Civilization [B] Mesopotamian culture [C] Incas Civilization [D] Aztecs Civilization Answer Correct Answer: B [Mesopotamian culture] ​ Notes: Factoring originated with ancient Mesopotamian culture, with rules of factoring preserved in the Code of Hammurabi. Factoring is a method used by some firms to obtain cash.

18.Which of the following company started the first Factoring business service in India? [A] SBI Factors and Commercials Limited [B] IFCI Factors Limited [C] Siemens Factoring Private Limited [D] Canbank Factors Limited Answer Correct Answer: A [SBI Factors and Commercials Limited] ​ Notes: SBI Factors and Commercials Limited was the first factoring company to start its operation in India in April, 1991. Since then a number of companies have started factoring business in India.

19.What is the normal time period range for factoring in India? [A] 70-80 days [B] 80-90 days [C] 90-120 days [D] 90-150 days Answer Correct Answer: D [90-150 days] ​ Notes: Usually the period for factoring is 90 to 150 days. Some factoring companies allow even more than 150 days. Factoring is considered to be a costly source of finance compared to other sources of short-term borrowings.

20.When was the Factoring Regulation Act passed in India? [A] 2011 [B] 2000 [C] 1991 [D] 2001 Answer Correct Answer: A [2011] ​ Notes: The parliament of India has passed the Factoring Regulation Bill in 2011.Any company can commence Factoring by obtaining registration from the RBI as a non-banking finance company. Such registration shall be governed by the existing law applicable to NBFCs as well as the new Factoring Regulation Act, 2011.

21.What do we call banking oriented towards mass welfare and financial inclusion of the poor? [A] Mass Banking [B] Narrow banking [C] Social banking [D] None of the above Answer Correct Answer: C [Social banking] ​ Notes: Social banking is a concept where banking services are oriented towards mass welfare and financial inclusion of the poor and vulnerable segments of society.

22.What is the type of banking which involves banking services for high net-worth clients like corporate, commercial banks, mid-size companies etc? [A] Retail Banking [B] Wholesale Banking [C] Narrow Banking [D] Merchant Banking Answer Correct Answer: B [Wholesale Banking] ​ Notes: Wholesale banking involves banking services for high net-worth clients like corporate, commercial banks, mid-size companies etc.

23.What is banking known as when a group of persons come together to own and control three or more independently chartered banks? [A] Chain banking [B] Unit banking [C] Merchant banking [D] None of the above Answer Correct Answer: A [Chain banking] ​ Notes: Chain banking system refers to the type of banking when a group of persons come together to own and control three or more independently chartered banks.

24.What is Banking combining banking and consultancy services called as? [A] Unit Banking [B] Merchant Banking [C] Narrow Banking [D] Wholesale Banking Answer Correct Answer: B [Merchant Banking] ​ Notes: Merchant banking is a combination of banking and consultancy services. It provides consultancy to its clients for financial, marketing, managerial and legal matters.

25.What is not true about Payment bank? [A] It cannot issue loans [B] It can accept deposits [C] It can issue credit cards [D] None of the above Answer Correct Answer: C [It can issue credit cards] ​ Notes: Payments banks is a new model of banks conceptualised by the Reserve Bank of India (RBI). These banks can accept a restricted deposit and cannot issue loans and credit cards.

26.Where was first set up in 1906? [A] Mangalore [B] Varanasi [C] Madras [D] Lahore Answer Correct Answer: A [Mangalore] ​ Notes: Canara Bank was established at Mangalore in 1906 by Ammembal Subba Rao Pai. It is one of the oldest public sector banks in the country and was nationalized in 1969.

27.Where is the head office of located? [A] Chennai [B] Madurai [C] Gurgaon [D] Patna Answer Correct Answer: A [Chennai] ​ Notes: Indian Overseas Bank (IOB) is a major public sector bank based in Chennai. It was set up in 1937 by Thiru.M. Ct. M. Chidambaram Chettya.

28.Which of these banks is not a private sector bank? [A] Jammu & Kashmir bank [B] Dhanlakshmi bank [C] [D] Answer Correct Answer: D [Corporation bank] ​ Notes: Corporation Bank is a public-sector banking company headquartered in Mangalore, India. All the other options given are private sector banks.

29.Which of these banks was earlier known as UTI Bank? [A] IndusInd Bank [B] [C] ICICI Bank [D] Answer Correct Answer: D [Axis Bank] ​ Notes: UTI Bank in June 2007 changed its name to Axis Bank. It was done to avoid confusion as several unrelated entities were using the UTI brand. 30.Which country Bank Pasargad belongs to? [A] Iran [B] Germany [C] Russia [D] Sweden Answer Correct Answer: A [Iran] ​ Notes: Bank Pasargad is also known as BPI, is a major Iranian private bank. It has its branches in India as well and registered with RBI as a foreign bank.

31.What is the share of Sponsor Banks in the Regional Rural Banks? [A] 75% [B] 25% [C] 15% [D] 35% Answer Correct Answer: D [35%] ​ Notes: The Regional Rural Banks were owned by the Central Government, the State Government and the Sponsor Bank who held shares in the ratios as follows Central Government – 50%, State Government – 15% and Sponsor Banks – 35%.

32.Which was the first RRB in India to adopt CBS platform? [A] Prathama Bank [B] Telangana Grameena Vikas Bank [C] Rushikulya Gramya Bank [D] Gaur Gramin Bank Answer Correct Answer: C [Rushikulya Gramya Bank] ​ Notes: The Rushikulya Gramya Bank (RGB), which operates in south Orissa, was the first RRB to have placed all its branches on the Core Banking Solutions (CBS) platform.

33.Which bank is a specialized financial institution for financing, facilitating and promoting foreign trade of India? [A] EXIM Bank [B] ICICI [C] IDBI [D] NABARD Answer Correct Answer: A [EXIM Bank] ​ Notes: The Export-Import Bank of India (EXIM Bank) is a specialized financial institution that was setup in 1982 for financing, facilitating and promoting foreign trade of India.

34.Where is the headquarters of SIDBI located? [A] Nagpur [B] Pune [C] Lucknow [D] Mumbai Answer Correct Answer: C [Lucknow] ​ Notes: The SIDBI (Small Industries Development Bank of India) was set up on April 2, 1990 under the Small Industries Development Bank of India Act, 1989. It has headquarters in Lucknow, Uttar Pradesh.

35.Which of the following activities can be undertaken by a Business Correspondent? [A] Selling mutual fund products [B] Selling Pension products [C] Extending small credit on behalf of the banks [D] All of the above Answer Correct Answer: D [All of the above] ​ Notes: The business correspondent is authorised to collect small ticket deposits and extend small credit on behalf of the banks. A BC also takes activities like selling mutual fund products, selling Pension products and extending small credit on behalf of the banks.

36.What is the function of the Board for Financial Supervision (BFS)? [A] supervision of the financial sector [B] supervision of all types of payment and settlement systems [C] appointing the directors of scheduled banks [D] All of the above Answer Correct Answer: A [supervision of the financial sector] ​ Notes: The main function of BFS is to undertake consolidated supervision of the financial sector comprising commercial banks, Non-Banking Finance Companies (NBFCs), development finance institutions, urban co-operative banks and primary dealers.

37.What do we call the instruments of monetary policy which directly affect the quantity of money supply? [A] Quantitative instruments [B] Qualitative instruments [C] Money instruments [D] None of the above Answer Correct Answer: A [Quantitative instruments] ​ Notes: The instruments of monetary policy which directly affect the quantity of money supply are called Quantitative instruments. Example: Open Market Operations Liquidity Adjustment Facility (Repo and Reverse Repo) etc.

38.What was the first ’s recommendation regarding the SLR? [A] to bring it down from 38.5% to 25% [B] to bring it up from 38.5% to 45% [C] to bring it down from 38.5% to 25% [D] None of the above Answer Correct Answer: C [to bring it down from 38.5% to 25%] ​ Notes: In the 1980s and 1990s, the SLR was very high. The first Narasimham Committee recommended bringing it down from 38.5% to 25%.

39.Which of these banks is regulated by Reserve bank of India? [A] Local Area Banks [B] Cooperative Banks [C] Commercial Banks [D] All of the above Answer Correct Answer: D [All of the above] ​ Notes: RBI regulates Commercial Banks, Regional Rural Banks, Local Area Banks, Cooperative Banks, Financial Institutions including Development Financial Institutions (DFIs) and Non-Banking Financial Companies.

40.What is the full form of OSMOS? [A] On Site Surveillance and Monitoring System [B] Off Site Surveillance and Monitoring System [C] Over-Simplified Method of Surveillance [D] On Site Migration of System Answer Correct Answer: B [Off Site Surveillance and Monitoring System] ​ Notes: OSMOS refers to Off Site Surveillance and Monitoring System. The RBI requires banks to submit detailed and structured information periodically under OSMOS. On the basis of OSMOS, RBI analyzes the health of the banks.

41.Which organisation functions as the authorised Bharat Bill Payment Central Unit? [A] [B] ICICI Bank [C] NPCI [D] Reserve Bank of India Answer Correct Answer: C [NPCI] ​ Notes: National Payments Corporation of India (NPCI) functions as the authorised Bharat Bill Payment Central Unit (BBPCU). It is responsible for setting business standards, rules and procedures for technical and business requirements for all the participants.

42.On which architecture is UPI built upon? [A] IMPS [B] NEFT [C] RBI [D] None of the above Answer Correct Answer: A [IMPS] ​ Notes: UPI is built on the IMPS architecture. Immediate Payment Service (IMPS) is an instant payment inter-bank electronic funds transfer system in India.

43.Which of the following is/are uses of foreign exchange reserves? [A] Back liabilities on their own [B] Influence Monetary policy [C] Both 1 and 2 [D] None of the above. Answer Correct Answer: C [Both 1 and 2] ​

44.What is OTP in credit card transactions? [A] Odd Transaction Password [B] Owner is Trading Pass code [C] One Time Password [D] One Time Pincode Answer Correct Answer: C [One Time Password] ​

45.What is the currency deposit ratio (CDR)? [A] ratio of money held by the public in currency to that of money held in bank deposits [B] ratio of money held by public in bank deposits to that of money held by public in currency [C] ratio of money held in demand drafts to that of money held in treasury bonds [D] none of the above Answer Correct Answer: A [ratio of money held by the public in currency to that of money held in bank deposits] Notes: The currency deposit ratio shows the amount of currency that people hold as a proportion of aggregate deposits.

46.Consider the following statements and identify the right ones. i. Deposits are created by banks and financial institutions. Ii. They constitute the major source of money supply in India. [A] I only [B] II only [C] Both [D] none Answer Correct Answer: C [Both] ​ Notes: A deposit is the act of placing cash with some entity, most commonly with a financial institution such as a bank. Deposits are usually the main source of funding for banks.

47.Which of the following about money supply measures adopted in 1998 is wrong? [A] M1= currency with public +demand deposits with banking system + other deposits with RBI [B] M2= M1 + savings deposits of post office savings bank [C] M3= M1+ time deposits with banking system [D] None of the above Answer Correct Answer: D [None of the above] ​ Notes: Money supply is defined as the total quantity of money circulating in the economy at a particular time. There are three measures of money supply M1, M2, and M3.

48.Which of the following is the placement of funds in an account with a bank? [A] Bank deposit [B] Foreign currency [C] Loan [D] All of the above Answer Correct Answer: A [Bank deposit] ​ Notes: Bank deposits refer to this liability rather than to the actual funds that have been deposited. When someone opens a bank account and makes a cash deposit, he surrenders legal title to the cash, and it becomes an asset of the bank.

49.The savings bank account that does not operate for more than 24 months, then the account is called? [A] dormant account [B] demat account [C] inoperative account [D] inactive amount Answer Correct Answer: A [dormant account] ​ Notes: A dormant account has had no activity for a long period of time, other than posting interest. A statute of limitations usually does not apply to dormant accounts, meaning that funds can be claimed by the owner or beneficiary at any time.

50.In which of the following accounts, shares and securities are held in dematerialized form? [A] Salary account [B] Current account [C] Demat account [D] Savings account Answer Correct Answer: C [Demat account] ​ Notes: Demat account number is quoted for all transactions to enable electronic settlements of trades to take place. Every shareholder will have a Dematerialized account for the purpose of transacting.

51.Where is the SARFAESI Act not applicable? [A] On unsecured loans [B] Loans below 100000 [C] where remaining debt is below 20% of the original principal [D] All of the above Answer Correct Answer: D [All of the above] ​ Notes: The SARFAESI Act does not apply to unsecured loans, loans below ₹100,000 or where remaining debt is below 20% of the original principal.

52.What are the advantages of BBPS? [A] Multiple Payment Modes [B] Payment of bill anywhere and anytime [C] Timely & guaranteed settlements between parties [D] All of the above Answer Correct Answer: D [All of the above] ​ Notes: Some of the advantages of BBPS are: 1. Multiple Payment Modes 2. Payment of bill anywhere and anytime 3. Timely & guaranteed settlements between parties

53.Which organisation developed BHIM Application? [A] SBI [B] RBI [C] NPCI [D] SEBI Answer Correct Answer: C [NPCI] ​ Notes: The BHIM mobile app was developed by the National Payments Corporation of India (NPCI). It is based on the Unified Payments Interface (UPI).

54.Which of the following methods can be used to send money over UPI? [A] Mobile number [B] VPA [C] Bank Account Number [D] All of the above Answer Correct Answer: D [All of the above] ​ Notes: Money can be sent or requested over UPI by following methods: Virtual Payment Address (VPA) or UPI ID, Mobile number, Account number & IFSC, , QR code.

55.Which of the following is facilitated by Foreign Exchange Reserves? [A] External trade [B] Orderly development [C] Maintenance of foreign exchange market [D] All of the above Answer Correct Answer: D [All of the above] ​

56.Which of the following is the feature of the commercial paper? [A] It is an additional instrument to the investing community. [B] It is an unsecured instrument issued in the form of promissory note. [C] The highly rated corporate borrowers can raise short term funds through this instrument. [D] All of the above Answer Correct Answer: D [All of the above] ​

57.Which of the following is used for International Monetary Transfer? [A] RTGS [B] NEFT [C] SWIFT [D] None of these Answer Correct Answer: C [SWIFT] ​

58.Which one among the following has not started commercial banking? [A] ICICI [B] SIDBI [C] IDBI [D] UTI Answer Correct Answer: B [SIDBI] ​

59.What is the most common type of time deposit? [A] Salary account [B] Current Account [C] FD [D] Loan Answer Correct Answer: C [FD] ​ Notes: Fixed Deposit (FD) is a financial instrument that provides safe and guaranteed return on your investment. It helps investors save some money for their future.

60.Credit Cards are a convenient substitute for which of the following? [A] Cash [B] Cheque [C] Both 1 and 2 [D] None of The Above Answer Correct Answer: C [Both 1 and 2] ​ Notes: A credit card is a issued to users (cardholders) to enable the cardholder to pay a merchant for goods and services based.

61.Who among the following has pointed out the contradictory nature of the terms “self-help” and “support”? [A] Michael K. Bartalos [B] C. Everett [C] Thomas Bent [D] None of the above Answer Correct Answer: A [Michael K. Bartalos] ​ Notes: Self-help groups mutual goal is to help each other to deal with, if possible to heal or to recover from, this problem. While Michael K. Bartalos (1992) has pointed out the contradictory nature of the terms “self-help” and “support”.

62.Which deposit account is for individuals to save money and earn the modest interest for that money held in the account? [A] Savings Bank Account [B] Current Account [C] Recurring Account [D] Fixed Deposit Account Answer Correct Answer: A [Savings Bank Account] ​ Notes: A savings account is an account maintained by a bank or other financial institutions for individuals to save money and earn interest on the cash held in the account.

63.Which of the following deposit accounts caters to professionals and businessmen alike? [A] Fixed Deposit Account [B] Savings Bank Account [C] Recurring Account [D] Current Account Answer Correct Answer: D [Current Account] ​ Notes: A current account is a type of deposit account that caters to professionals and businessmen alike. Dealing largely with liquid deposits, this product allows for withdrawal of funds and checks being written against the balance and does not limit the number of transactions in a day.

64.Which account is opened by the investor while registering with an investment broker? [A] Dematerialized Account [B] Recurring Account [C] Savings Bank Account [D] Fixed Deposit Account Answer Correct Answer: A [Dematerialized Account] ​ Notes: DEMAT or De-materialized Account refers to a deposit made at an Indian financial institution that can be used for investing in shares of stocks and other financial assets.Securities are held electronically in a DEMAT Account, thereby eliminating the need for physical paper certificates.

65.How many payments banks have actually started operations since RBI has granted the in-principle approval? [A] 3 [B] 5 [C] 9 [D] 6 Answer Correct Answer: D [6] ​ Notes: Six payments that have started operations are Aditya Birla , Airtel Payments Bank, , Fino Payments Bank, , Payments Bank.

66.What was the motive to bring the Payment and Settlement Systems Act, 2007 into being? [A] to provide for the regulation and supervision of payment systems [B] to designate RBI as the authority [C] matters connected therewith or incidental thereto [D] All of the above Answer Correct Answer: D [All of the above] ​ Notes: Payment and Settlement Systems Act, 2007 is an Act to provide for the regulation and supervision of payment systems in India and to designate the Reserve Bank of India as the authority for that purpose and for matters connected therewith or incidental thereto.

67.Which of the following Regulations is made under the PSS Act, 2007? [A] Board for Regulation [B] Supervision of Payment and Settlement Systems Regulations [C] Survey Board of Regulation [D] Both 1 and 2 Answer Correct Answer: D [Both 1 and 2] ​ Notes: Under the PSS Act, 2007, two Regulations have been made by the Reserve Bank of India, namely, the Board for Regulation and Supervision of Payment and Settlement Systems Regulations, 2008 and the Payment and Settlement Systems Regulations, 2008. Both these Regulations came into force along with the PSS Act, 2007 on 12th August 2008.

68.What is a “Settlement”? [A] settlement of payment instructions which bank has send [B] settlement of refunds [C] settlement of payment instructions received [D] none of the above Answer Correct Answer: C [settlement of payment instructions received] ​ Notes: “Settlement” means the settlement of payment instructions received and these include settlement of securities, foreign exchange or derivatives or other transactions. Settlement can take place either on a net basis or on a gross basis. Both netting and gross settlement system are defined under the Act.

69.What does S stands for in SFMS in relation to NEFT payment method? [A] Statutory [B] Systematic [C] Structured [D] Savings Answer Correct Answer: C [Structured] ​ Notes: NEFT SFMS message” means an electronic Structured Financial Messaging Solution (SFMS) message containing a batch of NEFT payment instructions for funds transfer, processed and consolidated in the manner specified for transmission of payment instructions from NEFT Service Centre to the NEFT Clearing Centre

70.How many digits are present in IFSC code? [A] 9 [B] 15 [C] 10 [D] 11 Answer Correct Answer: D [11] ​ Notes: IFSC – Indian Financial System Code. This is an 11 digit code with the first 4 alpha characters representing the bank, and the last 6 characters representing the branch. The 5th character is 0 (zero).

71.How many digits are present in IFSC code? [A] 9 [B] 15 [C] 10 [D] 11 Answer Correct Answer: D [11] ​ Notes: IFSC – Indian Financial System Code. This is an 11 digit code with the first 4 alpha characters representing the bank, and the last 6 characters representing the branch. The 5th character is 0 (zero).

72.NEFT works on the principle of which of the following? [A] Gross Batch Settlement [B] Deferred Net Settlement [C] Priority Net Settlement [D] Domain Net Settlement Answer Correct Answer: B [Deferred Net Settlement] ​ Notes: NEFT is an electronic fund transfer system that operates on a Deferred Net Settlement (DNS) basis which settles transactions in batches.

73.Which of the following accounts can be repatriable? [A] NRE Account [B] NRO Account [C] FCNR(B) Account [D] Both (A) and (C) Answer Correct Answer: D [Both (A) and (C)] ​ Notes: Non-Resident (External) Rupee Account Scheme [NRE Account] and Foreign Currency (Non-Resident) Account (Banks) Scheme [FCNR (B) Account] can be repatriable while Non- Resident Ordinary Rupee Account Scheme [NRO Account] is not repatriable except for all current income.

74.Which type of remittances are received from abroad? [A] Blockchain Remittance [B] Inward Foreign Remittance [C] Outward Foreign Remittance [D] None of the above Answer Correct Answer: B [Inward Foreign Remittance] ​ Notes: Inward Foreign Remittance means Remittance received from abroad. In other words remittance coming into our country from other countries by the remitter by way of permissible banking channel through freely convertible Foreign Currencies is called ‘Inward Foreign Remittance’ from the beneficiary country’s point of view. From the remitter’s point of view it is called outward Foreign Remittance.

75.Which of the following is not true about the National Electronic Funds Transfer (NEFT) system? [A] There is no limit on transaction through NEFT [B] NEFT operates in hourly batches. [C] NEFT is a payment system which facilitates one-to-one funds transfer. [D] Only bank branches which are NEFT enabled, can be a part of the NEFT funds transfer network. Answer Correct Answer: B [ NEFT operates in hourly batches. ] ​ Notes: RBI announced that additional 11 settlement batches at half- hourly intervals will be introduced from July 10 2017 , beginning from 8.30 am till 6.30 pm. With this, the total number of half hourly settlement batches during the day will increase to 23.

76.Coins upto what amounts are called ‘small coins’ in India? [A] 25 paise [B] 50 paise [C] 1 rupee [D] 2 rupee Answer Correct Answer: B [ 50 paise ] ​ Notes: Coins upto 50 paise are called ‘small coins’ and coins of Rupee one and above are called ‘Rupee Coins’. Small denomination coins which were made of bronze, nickel-brass, cupro-nickel, and aluminium-bronze were gradually minted in aluminium.

77.In borrowing and lending of federal funds, federal funds rate is result of function between which of the following? [A] supply and demand [B] assets and liability [C] Cost and marketing [D] Income and expense Answer Correct Answer: A [ supply and demand ] ​ Notes: The federal funds rate refers to the interest rate that banks charge other banks for lending them money from their reserve balances on an overnight basis.

78.Which of the following is the regulator of the money market? [A] RBI [B] Government of India [C] Telecom Regulatory authority [D] None of these Answer Correct Answer: A [RBI] ​ Notes: The government has proposed to amend the Reserve Bank of India (RBI) Act to take away money market regulatory powers from the and bring it under the purview of the Securities and Exchange Board of India.

79.In which year does the Reserve Bank of India introduce the concept of classification of money into M1, M2, M3 and so on? [A] 1956 [B] 1961 [C] 1977 [D] 1998 Answer Correct Answer: C [1977] ​ Notes: The measures of money supply in India are classified into four categories M1, M2, M3 and M4 along with M0. This classification was introduced in April 1977.

80.Which organisation regulates the capital market? [A] Government of India [B] RBI [C] SEBI [D] None of the above Answer Correct Answer: C [SEBI] ​ Notes: Security and exchange board of India (SEBI) regulates the capital market.

81.Under NBFC– Peer to Peer Lending Platform Directions, 2017 by RBI, what is the aggregate exposure limit of a single lender to all borrowers at any point of time, across all P2Ps? [A] Rs 50 lakh [B] Rs 5 lakh [C] Rs 10 lakh [D] Rs 15 lakh Answer Correct Answer: C [Rs 10 lakh] ​ Notes: Under NBFC– Peer to Peer Lending Platform Directions, 2017 by RBI, Rs 10 lakh is the aggregate exposure limit of a single lender to all borrowers at any point of time, across all P2Ps

82.Which of the following statements is/are correct? [A] NBFCs does not hold a banking license. [B] NBFC can issue Demand Drafts like banks. [C] Both 1 and 2 are correct [D] Neither of them are correct Answer Correct Answer: A [NBFCs does not hold a banking license.] ​ Notes: NBFC cannot accept demand deposits while NBFC cannot issue Demand Drafts like banks.

83.Under the guidelines issued on 2 Dec 2011, an NBFC-MFI should have minimum net owned funds of how much amount? [A] Rs. 3 crore [B] Rs. 4 crore [C] Rs. 5 crore [D] Rs. 6 crore Answer Correct Answer: C [Rs. 5 crore] ​ Notes: RBI has recently opened a separate category of non-banking financial companies for micro finance institutions, namely, NBFC-MFI under its control to remove the ambiguity over regulation of MFIs. Under the guidelines issued on 2 Dec 2011, an NBFC-MFI should have minimum net owned funds of Rs. 5 crore.

84.For an NBFC-MFI, the tenure of the loan must not to be less than how many months? [A] 12 months [B] 24 months [C] 18 months [D] 36 months Answer Correct Answer: B [24 months] ​ Notes: For an NBFC-MFI, the tenure of the loan must not be less than 24 months.

85.CIC’s Adjusted Net Worth shall not be less than how much percent of its aggregate risk weighted assets on the balance sheet? [A] 30% [B] 40% [C] 50% [D] 70% Answer Correct Answer: A [30%] ​ Notes: Every CIC-ND-SI shall ensure that at all times it maintains a minimum Capital Ratio whereby its Adjusted Net Worth shall not be less than 30% of its aggregate risk weighted assets on balance sheet and risk adjusted value of off-balance sheet items as an the date of the last audited balance sheet as at the end of the financial year.

86.Which of the following are functions of ? [A] Mobilization of savings [B] Allocation of fund [C] Specialized services [D] All of the above Answer Correct Answer: D [All of the above] ​ Notes: Mobilization of savings, allocation of funds and specialized services are all functions of financial services.

87.Which of the following is defined as a central location for keeping securities on deposit? [A] Institutions [B] Depository [C] Instrument [D] None of the above Answer Correct Answer: B [Depository] ​ Notes: A depository is an entity which helps an investor to buy or sell securities such as stocks and bonds in a paper-less manner. Securities in depository accounts are similar to funds in bank accounts.

88.Which of the following is the benefit of credit-rating to investors? [A] Safeguard against bankruptcy [B] Saving of resources [C] Credibility of issues [D] All of the above Answer Correct Answer: D [All of the above] ​ Notes: Saving of resources, Safeguard against bankruptcy and Credibility of issues are all benefits of credit-rating to investors.

89.A merchant bank is a financial institution conducting money market activities and which of the following? [A] Lending [B] Underwriting and financial advice [C] Investment service [D] All of the above Answer Correct Answer: D [All of the above] ​ Notes: A merchant bank is a financial institution conducting money market activities, lending, underwriting and financial advice and investment service.

90.Which of the following is true about merchant banks? [A] Underwrites securities for corporations [B] Advice clients on mergers [C] Involved in ownership of commercial ventures [D] All of the above Answer Correct Answer: D [All of the above] ​ Notes: Merchant bank underwrites securities for corporations, advises clients on mergers and gets involved in ownership of commercial ventures.

91.Issue management is an important function of which of the following? [A] Public banker [B] Lead banker [C] Merchant banker [D] Private banker Answer Correct Answer: C [Merchant banker] ​ Notes: Issue management is the process of identifying and resolving issues. Problems with staff or suppliers, technical failures, material shortages – these might all have a negative impact on your project.

92.Who among the following serves as the holder of debenture stock for the benefit of another party? [A] Company’s trustee [B] Debenture trustee [C] Bond trustee [D] SEBI Answer Correct Answer: B [Debenture trustee] ​ Notes: A debenture trustee is one that serves as the holder of debenture stock for the benefit of another party. When a company is looking to raise capital, one method of accomplishing this is by issuing stock as a form of debt with the obligation to repay the debt at a specific interest rate.

93.When making repayments on a lease, the profit and loss account will contain which items relevant to the lease? [A] Neither interest or instalment charges [B] Instalment charges only [C] Interest and instalment charges [D] Interest only Answer Correct Answer: D [Interest only] ​ Notes: When making repayments on a lease, the profit and loss account will contain interest relevant to the lease.