Quiz ( Banking and financial Awareness )

1. The govt. has ushered in reforms related to public sector banks? Which of the following is/are correct in this regard?

A) The posts of chairman and managing Director have been split.B) The PSBs will have a non-Executive chairman, giving operational responsibility to MD and CEO.C) The current structure of country’s largest lender SBI, which is headed by a chairman and assisted by serval managing Directors, will continue.D) All the aboveE) Only 1) and 2).Correct answer: D

2. Banks are coming up with a number of new concepts nowadays. Which of the following is NOT such a product/concept launched by the banks in India so far?

A) E-paymentB) Number portabilityC) SMS bankingD) Mobile bankingE) Demat accountCorrect answer: B

Solution : DEMAT 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.

3. The Reserve Bank of India (RBI) has NOT so far allowed who among the following to open and operate savings bank accounts independently?

A) Illiterate personsB) HousewivesC) Children below 10 yearsD) Landless labourersE) Persons with no source of earningCorrect answer: C

4. Which of the following financial institutions (FIs) does not come under the full-fledged regulation and supervision of the Reserve Bank of India (RBI)?

A) Small industries development Bank of India (SIDBI)B) National housing Bank (NHB)C) National Bank for agriculture and rural development (NABARD)D) Export import Bank of India (EXIM)E) None of theseCorrect answer: E

5. At present how many regional rural Banks (RRBS) are there in the country?

A) 52B) 56C) 64D) 82E) None of theseCorrect answer: B

6. Which of the following terms is NOT associated with banking sector?

A) Corporate financeB) SyndicationC) Prime meridianD) Sub-primeE) Sub-standard assetsCorrect answer: C

7. Which of the following institutions is associated with the regulation of finance-related activities in India?

A) FMCB) IFFCOC) IDBID) ICERTE) None of theseCorrect answer: A

8. Which of the following acts enables banks to reduce their non-performing assets (NPAs) by adopting measures for recovery or reconstructions?

A) RBI ActB) Banking Regulation ActC) State Bank of India ActD) SARFAESI ActE) Negotiable instruments ActCorrect answer: D

9. Credit cards are also known as which of the following?

A) Hard moneyB) Easy moneyC) Silver moneyD) Plastic moneyE) Elastic moneyCorrect answer: D

10. What is base rate?

A) Interest rate payable on demand depositsB) Interest rate payable on fixed depositsC) Interest charged by the RBI from PSBs on advancesD) Minimum interest rate fixed by banks below which they generally do not lendE) None of theseCorrect answer: D

11. An investor holds a wide range of shares. If the Reserve Bank of India announces a series of significant interest rate increases, the prices of these shares are most likely to?

A) IncreaseB) DecreaseC) Become volatileD) StagnantE) None of theseCorrect answer: B

12. A customer does not require to have a Bank account to obtain a

A) LoanB) chequeC) Bankers ChequeD) DraftE) Travellers chequeCorrect answer: D

Solution : Explanation: A bank draft is a check drawn on a bank’s funds, similar to a cashier’s check. The funds might be held in the same bank that creates the draft, or the money behind the draft might be held in the bank's account held at a different bank.

13. The SLR rate at present is

A) 21%B) 23%C) 22%D) 21.5%E) 22.5%Correct answer: A

Solution : Explanation: Statutory liquidity ratio (SLR) is the Indian government term for reserve requirement that the commercial banks in India require to maintain in the form of gold, government approved securities before providing credit to the customers. Statutory Liquidity Ratio is determined by Reserve Bank of India maintained by banks in order to control the expansion of bank credit. The SLR is commonly used to control inflation and fuel growth, by increasing or decreasing it respectively.

14. Who has been recently appointed as MD and CEO of United Bank of India?

A) D NarangB) Sanjay AryaC) P SrinivasD) Sanjib PatiE) Pratyush SinhaCorrect answer: C

Solution : Explanation: United Bank of India is an Indian government-owned financial services company headquartered in Kolkata, West Bengal, India.

15. RBI has increased the authorised capital of each regional Rural Bank (RRB) to how much (in Rs.)?

A) 100 crB) 500 crC) 1000 crD) 1500 crE) 2000 crCorrect answer: E

16. The Central govt. contributes towards the capital of Regional Rural Banks (RRBs) through

A) RBIB) SBIC) NABARDD) SIDBIE) None of theseCorrect answer: C

Solution : NABARD is an apex development bank in India, having headquarters in Mumbai (Maharashtra) and other branches are all over the country. The committee to review arrangements for Institutional Credit for Agriculture and Rural Development (CRAFICARD), set up by the Reserve Bank of India (RBI) under the chairmanship of Shri B. Sivaraman, conceived and recommended the establishment of National Bank for Agriculture and Rural Development (NABARD).

17. The Reserve Bank of India (RBI) revised the Repo rate on 15 Jan. what is the new Repo rate?

A) 8 per centB) 6.50 per centC) 7.5 per centD) 7 per centE) None of theseCorrect answer: B

18. Name the committee formed to suggest ways and means to raise the revenue of Indian Railways which submitted its report on 30 Dec.

A) Bibek Debroy committee

B) DK Mittal committeeC) E Sreedharan committeeD) Arvind Panagariya committeeE) None of theseCorrect answer: B

19. Who among the following are the beneficiaries of micro-finance activities?

A) HawkersB) Marginal farmersC) Landless labourersD) All the aboveE) None of theseCorrect answer: D

20. Which of the following is he fall in the price but without causing unemployment? While fighting inflation, the RBI wants it?

A) DeflationB) StagflationC) ReflationD) DisinflationE) None of theseCorrect answer: D

Solution : Deflation is a decrease in general price levels of throughout an economy. If there is a higher supply of goods and services but there is not enough money supply to combat (tackle) this, deflation can occur. Deflation is mainly caused by shifts in supply and demand.

Disinflation, on the other hand, shows the rate of change of inflation over time. The inflation rate is declining over time, but it remains positive. For example, if the inflation rate in the India was 5% in January but decreases to 4% in March, it is said to be experiencing disinflation in the first quarter of the year.

21. Currency that a govt. has declared to be legal tender, but is not backed by a physical commodity, is called

A) Dear moneyB) Cheap money

C) Fiat moneyD) Hot moneyE) None of theseCorrect answer: C

Solution : Fiat money is currency that a government has declared to be legal tender, but is not backed by a physical commodity. The value of fiat money is derived from the relationship between supply and demand rather than the value of the material that the money is made of.

Historically, most currencies were based on physical commodities such as gold or silver, but fiat money is based solely on faith. Fiat is the Latin word for "it shall be".

22. An interest rate on a loan or security that fluctuates over time, because it is based on an underlying benchmark interest rate or index that changes periodically, is called

A) Base interest rateB) Index interest rateC) Migratory interest rateD) Variable interest rateE) None of theseCorrect answer: D

23. In Banking and Finance, a loan with scheduled periodic payments of both principal and interest, typically through equal payments, is known as

A) Amortised loanB) Unsecured loanC) Scheduled loanD) Syndicate loanE) None of theseCorrect answer: A

Solution : In banking and finance, an amortizing loan is a loan where the principal of the loan is paid down over the life of the loan (that is, amortized) according to an amortization schedule, typically through equal payments.

24. The CER registry was set up to help check frauds by depositing multiple documents of title relating to the same property. What is the full form of CER?

A) Central Exclusive RegistryB) Central Electronic RegistryC) Central Entry RegistryD) Central Electronic RegistrationE) None of theseCorrect answer: B

Solution : Central Registry of Securitisation Asset Reconstruction and Security Interest (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.

25. Which of the following is NOT correct with respect to the Magnetic Ink character recognition (MICR) code used to facilitate the processing of cheques?

A) It has nine digitsB) Its first three digits represents the state code where the bank is situatedC) The middle three digits stand for the bank codeD) The last three digits represents the bank branch codeE) None of theseCorrect answer: B

Solution :

MICR stands for Magnetic Ink Character Recognition. It is a technology which allows machines to read and process cheques enabling thousands of cheque transactions in a short time. MICR code is usually a nine digit code comprising of some important information about the transaction and the bank.

The first three digits in the MICR code represent the city code that is the city in which the bank branch is located. In most cases it is in line with the PIN code of the postal addresses in India. The next three digits stand for the bank code while the last three digits represent the bank branch code.

For example, if you have an account with Axis Bank, New Delhi (Defence Colony) then its nine digit MICR code will be 110211004 where:

110, the first three digits representing the city code for New Delhi;

211, the next three digits representing the bank code for Axis bank;

And 004, the last three digits representing the bank branch code for Defence Colony.

26. Which of the following is NOT a KYC requirement while opening a bank account?

A) A proof of identityB) A proof of addressC) A proof of incomeD) A recent photographE) None of theseCorrect answer: C

Solution : KYC means “Know Your Customer”. It is a process by which banks obtain information about the identity and address of the customers. This process helps to ensure that banks’ services are not misused. The KYC procedure is to be completed by the banks while opening accounts and also periodically update the same.

The Government of India has notified six documents as ‘Officially Valid Documents (OVDs) for the purpose of producing proof of identity. These six documents are Passport, Driving Licence, Voters’ Identity Card, PAN Card, Aadhaar Card issued by UIDAI and NREGA Card. You need to submit any one of these documents as proof of identity. If these documents also contain your address details, then it would be accepted as as ‘proof of address’. If the document submitted by you for proof of identity does not contain address details, then you will have to submit another officially valid document which contains address details.

27. Every year 8 March is celebrated as:

A) Father’s dayB) Women’s dayC) Mother’s dayD) Girl chid dayE) None of theseCorrect answer: B

28. The govt. of India has notified six document as ‘officially valid documents (OVDs)’ for the purpose of producing proof of identity. Which of the following is NOT one of them?

A) NREGA cardB) Aadhaar card issued by UIDAIC) PAN cardD) Voters’ Identity cardE) None of theseCorrect answer: E

29. Even if you do not have any of the documents listed by the govt. to show your ‘proof of Identity’, you can open a bank account with a bank. This account is known as:

A) Micro accountB) BSBDAC) No frills accountD) Small accountE) None of theseCorrect answer: D

Solution : Small account can be opened by any individual above 18 years old, who do not have Officially Valid KYC documents. There are many restrictions in operation of the account due to the relaxed KYC. Account can be converted to Regular Savings Account upon submission of KYC documents. Primarily meant for poorer sections of society to encourage them to start saving without any burden of charges or fees.

30. The finance minister has proposed to set up MUDRA bank to boost loans for the country’s cash-starved small businesses. The MUDRA bank will be set up with what amount as capital?

A) $2.2 billionB) $3.2 billionC) $4.2 billionD) $5.2 billionE) None of theseCorrect answer: B

Solution : The Prime Minister Narendra Modi launched the promised Micro Units Development and Refinance Agency Ltd (MUDRA) Bank on 8 April, 2015 with a corpus of Rs 20,000 crore and a credit guarantee corpus of Rs 3,000 crore. The launch was the fulfilment of an announcement made earlier by the Finance Minister Arun Jaitley in his FY 15-16 Budget speech.

The principal objectives of the MUDRA Bank are:

1. Regulate the lender and the borrower of microfinance and bring stability to the microfinance system through regulation and inclusive participation.

2. Extend finance and credit support to Microfinance Institutions (MFI) and agencies that lend money to small businesses, retailers, self-help groups and individuals.

3. Register all MFIs and introduce a system of performance rating and accreditation for the first time. This will help last-mile borrowers of finance to evaluate and approach the MFI that meets their requirement best and whose past record is most satisfactory. This will also introduce an element of competitiveness among the MFIs. The ultimate beneficiary will be the borrower.

4. Provide structured guidelines for the borrowers to follow to avoid failure of business or take corrective steps in time. MUDRA will help in laying down guidelines or acceptable procedures to be followed by the lenders to recover money in cases of default.

5. Develop the standardised covenants that will form the backbone of the last-mile business in future.

6. Offer a Credit Guarantee scheme for providing guarantees to loans being offered to micro businesses.

7. Introduce appropriate technologies to assist in the process of efficient lending, borrowing and monitoring of distributed capital.

8. Build a suitable framework under the Pradhan Mantri MUDRA Yojana for developing an efficient last-mile credit delivery system to small and micro businesses.

31. ‘India’s daughter’, a documentary which made news and created controversy recently, is related to

A) Successful women CEOs of IndiaB) Successful women entrepreneurs of IndiaC) Indian women working abroadD) Interview of rape victims of IndiaE) Interview of accused of Nirbhaya rape caseCorrect answer: E

32. An individual can have what number of ‘Basic’ savings Bank Deposit Account’ in one bank?

A) Only oneB) Only twoC) Only threeD) Only fourE) Any number of BSBDA accountCorrect answer: A

Solution :

The main features of saving account in bank are as follows:

1. The main objective of saving account is to promote savings.2. There is no restriction on the number and amount of deposits. However, in India, mandatory PAN (Permanent Account Number) details are required to be furnished for doing cash transactions exceeding र 50,000.3. Withdrawals are allowed subject to certain restrictions.4. The money can be withdrawn either by cheque or withdrawal slip of the respective bank.5. The rate of interest payable is very nominal on saving accounts. At present it is between 4% to 6% p.a in India.6. Saving account is of continuing nature. There is no maximum period of holding.7. A minimum amount has to be kept on saving account to keep it functioning.8. No loan facility is provided against saving account.9. Electronic clearing System (ECS) or E-Banking are available to pay electricity bill, telephone bill and other routine household expenses.10. Generally, equated monthly instalments (EMI) for housing loan, personal loan, car loan, etc., are paid (routed) through saving bank account.

33. Which of the following institutions issues a 3-digit number ranging from 300-900 which reflects the credit profile of individuals?

A) CAREB) CRISILC) CIBILD) CAMELSE) None of theseCorrect answer: C

Solution : Credit Information Bureau (India) Limited is India’s first Credit Information Company (CIC) founded in August 2000. CIBIL collects and maintains records of an individual’s payments pertaining to loans and credit cards. These records are submitted to CIBIL by member banks and credit institutions, on a monthly basis. This information is then used to create Credit Information Reports (CIR) and credit scores which are provided to credit institutions in order to help evaluate and approve loan applications. CIBIL was created to play a critical role in India’s financial system, helping loan providers manage their business and helping consumers secure credit quicker and on better terms.

34. Currency of Mauritius:

A) Mauritian dollarB) Mauritian pesoC) Mauritian rupee

D) Mauritian rupiahE) Mauritian none of theseCorrect answer: C

35. The economic survey for 2014 – 2015 has mentioned the JAM trinity to support poor households. In the JAM trinity, the letter M denotes?

A) MediaB) Mobile numbersC) MissionD) MGNREGAE) None of theseCorrect answer: B

Solution : The economic empowerment and financial inclusion of people till the last level has been the theme outlining government policies since last two budget sessions in India. JAM Trinity refers to the consolidation of three critical spokes, i.e; Prime Minister Jan Dhan Yojana (PMJDY), Aadhaar and Mobile connectivity (JAM), in the wheel of economic policies that are meant to drive the financial inclusion measures to bring about an overall empowerment. JAM Trinity is one of the key reforms undertaken to deliver the Direct Benefit Transfer (DBT) scheme, including subsidies, minimum wage payments for various government schemes and other payments.

To highlight the huge direct impact the JAM Trinity may have, we need to look at some figures. According to the Economic Survey, about 4.2 per cent of the GDP, which works out to roughly Rs 3.78 lakh crore is spent on key subsidies. As of March 2015, there were more than 227 million beneficiaries under 36 different schemes, who were a part of the DBT programme.

36. What is the term used for a deposit with a bank that locks up money for a certain period but also provides an option of premature withdrawal which may attract a penalty?

A) Savings bank depositsB) Term depositC) Recurring depositD) Current depositE) None of theseCorrect answer: B

37. Which of the following is a secure messaging standard developed to serve as a platform for intra-bank and inter-bank applications and is an Indian standard similar to SWIFT?

A) SFMSB) NEFTC) NPCID) RTGSE) CFMSCorrect answer: A

Solution : Structured Financial Messaging System (SFMS) is a secure messaging standard developed to serve as a platform for intra-bank and inter-bank applications. It is an Indian standard similar to SWIFT (Society for World-wide Interbank Financial Telecommunications) which is the international messaging system used for financial messaging globally.

SFMS can be used for secure communication within the bank and between banks. The SFMS was launched on December 14, 2001 at IDRBT. It allows the definition of message structures, message formats, and authorization of the same for usage by the financial community. SFMS has a number of features and it is a modularized and web enabled software, with a flexible architecture facilitating centralized or distributed deployment. The access control is through Smart Card based user access and messages are secured by means of standard encryption and authentication services conforming to ISO standards.

38. Which of the following is NOT a retail banking product?

A) Fixed deposit accountB) Working capital financeC) Personal loanD) Housing loanE) Educational loanCorrect answer: B

39. Which of the following is NOT a money market instruments?

A) Repurchase agreementB) Commercial paperC) DebenturesD) Treasury billsE) Certificates of depositsCorrect answer: C

40. Which of the following statement is NIT true regarding budgets proposals in the general budget for FY16 for banking sector?

A) To promote cashless transactions to curb black moneyB) To amend RBI Act this year for monetary policy committeeC) Autonomous bank board bureau to determine PSU bank headsD) To appoint two more deputy governors in the RBIE) None of theseCorrect answer: D

41. Account holders have to maintain an AQB for their accounts in certain banks. What does the term AQB stand for?

A) Average Qualitative BalanceB) Average Quantitative BalanceC) Average Quarterly BalanceD) Average Qualified BalanceE) None of the aboveCorrect answer: C

42. The book titled the modi Effect: Inisde Narendra Modi’s Campaign to Tranform India, has been authored by

A) Jean seatonB) Simon lewisC) Lance priceD) Alastair Campbell E) Julian gloverCorrect answer: C

43. The proposed micro units development refinance Agency (Mudra) Bank will be first set up as a subsidiary of the

A) NABARDB) SBIC) EXIM bankD) SIDBIE) Other than those given as options

Correct answer: D

44. The KYC requirement can be fulfilled through e-KYC only for those who have:

A) PAN CardB) Voter Identity CardC) Aadhaar numberD) PassportE) Other than those given as optionsCorrect answer: C

Solution : Aadhaar eKYC is a service offered under Aadhaar project by UIDAI department of Government of India. Under this service organizations can establish the positive Identity of their customers by validating their Name, Address and other information against their Biometric Identity with Aadhaar data centre.KYC (Know Your Customer) via in person or documentary verification is already mandatory in many Government, Semi-government, public sector along with all types of Banking & Finance activities in India. This manual process is very time consuming and may still not be able to establish correct identity. Large number of bogus accounts or identities are created every day to get extra benefits or hide correct information.

eKYC make this process simple and electronic. In addition it offer Biometric based validation which can root out all bogus accounts from the system leading to huge savings.

45. For which banking transactions does an individual not need to quote his/her PAN number?

A) Account openingB) Deposit in cash aggregating Rs.50,000 or more during any one dayC) Making an application for issue of credit card or debit cardD) Payment in cash for purchase of bank drafts up to Rs.50,000E) Other than those given as options.Correct answer: D

46. The permanent account number (PAN) is a ten digit alphanumeric number in which the fourth character represents the status of the PAN holder. If the fourth letter in a PAN is ‘P’, it stands for

A) Individual B) Firm

C) Private companyD) HUFE) TRUSTCorrect answer: C

47. In the priority lending target for scheduled banks for agriculture sector, the RBI has recommended a sub-target of what per cent of Adjusted Net Bank Credit (ANBC) for small and marginal farmers?

A) 18 per centB) 8 per centC) 10 per centD) 12 per centE) 6 per centCorrect answer: B

48. The commercial paper (CP) is an unsecured money market instrument issued in the form of a promissory note. The amount invested by a single investor in the CP should not be less than …………………. (face value)

A) Rs. 5 lakhB) Rs. 10 lakhC) Rs. 15 lakhD) Rs. 25 lakhE) Rs. 50 lakhCorrect answer: A

49. In Banking, IFSC code stand for

A) International forex system codeB) Other than those given as optionsC) Indian function system codeD) Indian Financial system codeE) International format system codeCorrect answer: D

50. Which of the following authorities issued IEC code to enable an entity to undertake export/import business in our country?

A) Finance ministryB) DGFTC) RBID) SEBIE) No such code is necessary hence anyone can undertake import/export business.Correct answer: B

51. Which of the following is the main objective of the govt. in introducing the Jan Dhan Yojana?

A) To provide minimum one account for every householdB) To ensure that banks in India gets more depositsC) Other than those given as optionsD) To increase the number of savings bank accounts in public sector banksE) To increase the vote bankCorrect answer: A

Solution : Prime Minister Narendra Modi today formally launched the government's financial inclusion programme - the Pradhan Mantri Jan Dhan Yojana.

1) This is the largest such exercise in the financial services sector in the country, claims Prime Minister Narendra Modi. One and a half crore bank accounts were opened via almost 80,000 camps in rural and urban areas, along with the same number of insurance policies, which Modi claimed was a national record for most number of accounts opened in a day.

2) At least 7.5 crore households will get basic bank accounts by January 25, 2015, a day before Republic Day. Modi says Finance Ministry has promised this will be done.

3) In the first phase, each household get an RuPay debit card for PoS sales. Upon satisfactory operation of the account for six months, the account holder will get a Rs 5000 overdraft facility. Modi says having a debit card will help counter the current economic apartheid in the country, This will also strengthen the savings habit in the country, he added.

4) In the second phase, all households that open such bank accounts under the Jan Dhan Yojana will get Rs 1 lakh accident insurance for 1.5 crore people. The poor face considerable out-of-pocket expenses in medical emergencies; in the lack of formal credit facility through banking channels, this pushes them into debt-traps.

5) All those who open accounts by January will get Rs 30,000 life insurance over and above the Rs 100,000 accident insurance. Again, this will ease financial pressure on lower-income sections, who are often left with no source of income when the primary earning member passes away.

52. Which of the following issues commercial paper?

A) Other than those given as optionB) High net worth individualsC) BanksD) RBIE) CorporatesCorrect answer: E

53. In Banks’ group-wise classification, IDBI bank Ltd has been included in which of the following?

A) Private sector banksB) Foreign banksC) Investments banksD) Other than those given as optionsE) Public sectors banksCorrect answer: E

54. In Limited Liability Partnership (LLP) what is the extent of liability of a partner?

A) Liability of a partners is joint and severalB) Other than those given as optionsC) Each partner is fully liableD) Limited to the extent of his share holdingE) Each partner is liable not only to the extent of his share but also to the share of other partners in case of any shortfallCorrect answer: D

55. Who is always a drawee of cheque?

A) BankB) The one who writes the chequeC) The one who receives paymentD) The one who writes and deposits the chequeE) Other than those given as optionsCorrect answer: A

56. According to the existing Insurance Act, the commission paid to an agent was not to exceed 40 per cent of the first year’s premium in the life insurance business. The new Insurance Bill has capped the above commission to

A) There is now no official capB) 2.25 per centC) 5 per centD) 10 per centE) 25 per centCorrect answer: A

57. Which of the following is the country’s umbrella body for all retail payment system?

A) SWIFTB) CAMELSC) IBAD) NPCIE) None of theseCorrect answer: D

Solution : National Payments Corporation of India is the umbrella organisation for all retail payment systems in India, with a vision to enable citizens of the country to have access to e-payment services at anyplace and anytime.

Founded in 2008, NPCI is a not-for-profit organisation registered under section 25 of the Companies Act, 2013. The organisation has been promoted by the country’s central bank, the Reserve Bank of India.

It has successfully completed the development of a domestic card payment network called RuPay, reducing the dependency on international card schemes. The RuPay card is now accepted at all the ATMs (2,22,278+)*, Point of Sale (PoS) terminals (12,20,763+)* and most of the e-Com merchants (30,000+)* in the country. More than 300* Cooperative banks and the Regional Rural Banks (RRBs) in the country have also issued RuPay ATM cards.

58. The govt. has proposed to merged commodities regulator with SEBI. As of now, the commodity market is regulated by:

A) MCXB) CARE

C) NSED) FMCE) BSECorrect answer: D

Solution : The Forward Markets Commission (FMC) is the chief regulator of commodity futures markets in India. As of July 2014, it regulated Rs 17 trillion worth of commodity trades in India. It is headquartered in Mumbai and this financial regulatory agency is overseen by the Ministry of Finance. The Commission allows commodity trading in 22 exchanges in India, of which 6 are national.

On 28 September 2015 the FMC was merged with the Securities and Exchange Board of India (SEBI).

59. The IRDA is mulling to relax norms for banc assurance. The RBI recently issued regulations enabling banks to become insurance brokers. Which of the following is a condition(s) put by the RBI for the same?

A) The capital-to-risk (weighted) assets ratio is at least 10 per centB) The level of net non-performing assets is not above three per centC) The Bank’s net worth should not be less than Rs.1,000 cr.D) All the aboveE) Only 1) and 2)Correct answer: D

60. The insurance sector regulator, IRDA, has been empowered by the new insurance law to regulate key aspects of insurance company operations. These areas do not include?

A) CommissionsB) ExpensesC) InvestmentsD) SolvencyE) None of theseCorrect answer: E

61. The properties in India can now be insured with a foreign insurer with prior permission of IRDAI. Earlier it was required to be done with the approval of the

A) Concerned state Govt.

B) Central Govt.C) RBID) SEBIE) GIC ReCorrect answer: B

62. Reinsurance is a business which provides insurance cover to the:

A) Bank depositsB) CorporatesC) Multilateral lending agenciesD) Insurance playersE) Assets reconstruction companies (ARCs)Correct answer: D

63. Identify the one which is NOT related to the field of insurance

A) Principle of indemnityB) Principle of subrogationC) Principle of uberrima fidesD) Principle of supply and demandE) None of theseCorrect answer: D

64. The principle of insurable interested is not applicable in case of which of the following insurance contracts?

A) Life insuranceB) Motor insuranceC) Health insuranceD) Marine insuranceE) None of theseCorrect answer: E

65. The insurance regulatory and development authority (IRDA) declared which of the following days as the ‘Insurance awareness Day’ to deepen insurance penetration in the country?

A) 2 Apr

B) 4 AprC) 7 AprD) 12 AprE) 19 AprCorrect answer: E

66. The Executive Board of the IMF has included renminbi (yuan) into its basket of currencies that make up the SDR. The term SDR stands for

A) Specific Drawing RightB) Special Drawing RightC) Structured Drawing RightD) Systematic Drawing RightE) None of theseCorrect answer: B

67. The RBI imposed a penalty of Rs.1 cr on which of the following associate banks of the SBI?

A) State Bank of PatialaB) State Bank of MysoreC) State Bank of HyderabadD) State Bank of Bikaner & JaipurE) State Bank of TravancoreCorrect answer: E

68. The World Bank, in a recent report, mentioned about which of the following initiatives that it is estimated to be saving the govt about $1 bn annually?

A) Swachh Bharat AbhiyanB) Pradhan Mantri Jan-Dhan YojanaC) AadhaarD) Mission IndradhanushE) MGNREGACorrect answer: C

Solution : Aadhaar digital ID, is estimated to be saving the government about one billion US dollars annually by curbing corruption

This was stated by World Bank Chief Economist Kaushik Basu during the release of annual World Bank report ‘Digital Dividends’ in Washington.

He said India increased access and reduced corruption in public services by providing unique digital identification to about one billion people

India is on track to register its entire 1.25 billion populations using its Aadhaar digital ID, the World Bank said. This, it said, would help the government to promote the inclusion of disadvantaged groups in its welfare schemes

69. The RBI has granted in-principle approval to NPCI to function as the central unit for BBPS. The full form of the term BBPS is

A) Bharat Basic Payment SystemsB) Bharat Broad Payment SystemsC) Bharat Bill Payment SystemsD) Bharat Bank Payment SystemsE) Other than those given as optionsCorrect answer: C

Solution : Bharat Bill Payment System (BBPS) is an integrated bill payment system which will offer interoperable bill payment service to customers online as well as through a network of agents on the ground. The system will provide multiple payment modes and instant confirmation of payment.

The policy guidelines for the BBPS system were issued by the Reserve Bank of India on November 28, 2014. The BBPS will operate as a tiered structure with a single Bharat Bill Payment Central Unit (BBPCU) and multiple Bharat Bill Payment Operating Units (BBPOUs).

Bharat Bill Payment Central Unit (BBPCU) will be a single authorized entity operating the BBPS. The BBPCU will set necessary operational, technical and business standards for the entire system and its participants, and also undertake clearing and settlement activities. As indicated in the circular dated November 28, 2015 National Payment Corporation (NPCI) has been identified to act as BBPCU. It will be an authorized entity under the Payment and Settlement Systems Act, 2007.

70. Which of the following foreign banks operating in India recently announced to shut its private banking business in the country?

A) CitibankB) HSBCC) ABN Amro Bank

D) Deutsche BankE) Calyon BankCorrect answer: B

71. Which of the following is a term deposit account that can be maintained by NRIs and PIOs in foreign currency in India?

A) NREB) NROC) FCNRD) All the aboveE) None of theseCorrect answer: C

72. An Indian bank authorised to deal in foreign exchange maintains an account with an overseas bank in USA in US Dollar. Such account of an Indian bank is called a

A) Nostro accountB) Vostro accountC) Loro accountD) FCNR accountE) NRO accountCorrect answer: A

Solution : Nostro and vostro are accounting terms used to distinguish an account held for another entity from an account another entity holds. The entities in question are almost always, but need not be, banks.

The terms nostro and vostro are used, mainly by banks, when one bank keeps money at another bank. Both banks need to keep records of how much money is being kept by one bank on behalf of the other. In order to distinguish between the two sets of records of the same balance and set of transactions, banks refer to the accounts as nostro and vostro. Speaking from the point of view of the bank whose money is being held at another bank:

A nostro is our account of our money, held by the other bank

A vostro is our account of other bank money, held by us

A vostro account is the same as any other bank account. It is a record of money held by a bank or owed to a bank by a third party (an individual, company or bank). The nostro account is a way of

the bank whose money it is, keeping track of how much is being held by the other bank. It is similar to an individual keeping a detailed record of every payment in and out of his or her bank account so that she/he knows the balance at any point in time.

73. The RBI pays interest to the banks for parking their excess money with it. The rate of interest paid by the RBI in the above case is termed as

A) bank rateB) base rateC) repo rateD) reverse repo rateE) prime lending rateCorrect answer: D

Solution : Repo Rate and Reverse Repo Rate

Repo rate is the rate at which RBI lends to its clients generally against government securities. Reduction in Repo rate helps the commercial banks to get money at a cheaper rate and increase in Repo rate discourages the commercial banks to get money as the rate increases and becomes expensive. Reverse Repo rate is the rate at which RBI borrows money from the commercial banks. The increase in the Repo rate will increase the cost of borrowing and lending of the banks which will discourage the public to borrow money and will encourage them to deposit. As the rates are high the availability of credit and demand decreases resulting to decrease in inflation. This increase in Repo Rate and Reverse Repo Rate is a symbol of tightening of the policy.

74. Which of the following will NOT be counted as an asset of a bank?

A) Cash with RBIB) Bills and Securities discountedC) Fixed deposits with itD) Loans and advances givenE) Investment of bankCorrect answer: C

75. A person writes a cheque and signs it, ordering his bank to pay a person the amount of money stated. Here, the bank is called the

A) drawerB) draweeC) payee

D) payerE) endorseeCorrect answer: B

Solution : Drawee is a legal and banking term used to describe the party that has been directed by the depositor to pay a certain sum of money to the person presenting the check or draft. A typical example is if you are cashing a paycheck. The bank that cashes your check is the drawee, your employer who wrote the check is the drawer, and you are the payee.

76. In economics, a decrease in the general price level of goods and services is termed as

A) inflationB) deflationC) disinflationD) stagflationE) recessionCorrect answer: B

Solution : In economics, deflation is a decrease in the general price level of goods and services.[1] Deflation occurs when the inflation rate falls below 0% (a negative inflation rate). Inflation reduces the real value of money over time; conversely, deflation increases the real value of money – the currency of a national or regional economy. This allows one to buy more goods and services than before with the same amount of money.

Economists generally believe that deflation is a problem in a modern economy because it increases the real value of debt, and may aggravate recessions and lead to a deflationary spiral.[2]

Deflation is distinct from disinflation, a slow-down in the inflation rate, i.e. when inflation declines to a lower rate but is still positive.

77. The Bank Aapki Muththi Mein initiative to turn a mobile phone into a bank branch, is associated with

A) ICICI BankB) HDFC BankC) Axis BankD) Bandhan BankE) SBICorrect answer: B

78. Which of the following terms is used in the field of economics?

A) LienB) NibbleC) PrequelD) Sine dieE) LitterCorrect answer: A

79. A severe and prolonged recession, a situation of declining economic activities, is called

A) sequestrationB) stagflationC) depressionD) deflationE) contractionCorrect answer: C

80. According to RBI guidelines, Payments Banks will not be allowed to issue

A) Debit cardsB) Credit cardsC) Prepaid cardsD) ATM cardsE) Gift cardsCorrect answer: B

81. ‘Article 14’ of the Indian Constitution deals with the

A) Equality in matters of public employmentB) Other than those given as optionsC) Social EqualityD) Equality before lawE) Equal access to public areasCorrect answer: D

82. The Employees’ Provident Fund Organisation (abbreviated as EPFO) is a statutory body of the Government of India under the

A) Ministry of FinanceB) Ministry of Labour and EmploymentC) Ministry of Personnel, Public Grievances and PensionD) Ministry of Human Resources DevelopmentE) Ministry of Social Justice and EmpowermentCorrect answer: B

83. The International Development Association (IDA), a member of the World Bank Group, is headquartered in

A) New YorkB) The HagueC) Washington, DCD) GenevaE) ParisCorrect answer: C

84. The majority shareholder in the share capital of ‘Bank of Baroda’ is

A) Reserve Bank of IndiaB) Banks/Insurance CompaniesC) Government of IndiaD) Corporates/lndividualsE) NRI/Foreign Institutional InvestorsCorrect answer: C

85. The process of gathering funds from several investors through a web-based platform for a project or businessventure is called

A) Crowd FundingB) Angel FundingC) Private Equity FundingD) Venture Capital FundingE) Micro FinancingCorrect answer: A

86. The online payments and money transfer solution ‘PayZapp’ has recently been launched by

A) ICICI BankB) Axis BankC) HDFC BankD) State Bank of IndiaE) IDBI BankCorrect answer: C

87. ‘Allahabad Bank’ is a nationalised bank with its headquarters in

A) BengaluruB) New DelhiC) KolkataD) MumbaiE) ChennaiCorrect answer: C

88. Under the new gold monetisation scheme, the banks will be allowed to take a minimum deposit of how much of gold from individuals?

A) 25 gramsB) 30 gramsC) 50 gramsD) 60 gramsE) 75 gramsCorrect answer: B

89. The “Balance Nail” is the name of a month-long joint military training held in Nepal, recently, between the security forces of Nepal and

A) AustraliaB) UKC) JapanD) ChinaE) USCorrect answer: E

90. Banks are offering payment solutions which do not require swiping credit/debit card and is completed by scanning a QR code. Here, the term QR stands for

A) Quick RequestB) Quick ResponseC) Quick ReturnD) Quick ReceiptE) Quick ReleaseCorrect answer: B

91. What is the term used for the excise duty, included in the proposed GST, levied on products and services like alcohol, tobacco and gambling considered bad for health or society?

A) Black taxB) Moral taxC) Evil taxD) Super taxE) Sin taxCorrect answer: E

Solution : A sin tax is an excise tax specifically levied on certain goods deemed harmful to society, for example alcohol and tobacco, candies, drugs, soft drinks, fast foods, coffee, and gambling. Two claimed purposes are usually used to argue for such taxes. In contrast to pigovian taxes, which are to pay for the damage to society caused by these goods, sin taxes are used to increase the price in an effort to reduce their use, or failing that, to increase and find new sources of revenue. Increasing a sin tax is often more popular than increasing other taxes. However, these taxes have been criticized for burdening the poor and being part of a nanny state.

92. The FIIs, NRIs and PIOs (Persons of Indian Origin) can invest in primary and secondary capital markets in India through PIS. What does the term PIS stand for?

A) Preferential Investment SchemeB) Preferential Investment SystemC) Portfolio Investment SystemD) Portfolio Investment SchemeE) Particular Investment SchemeCorrect answer: D

Solution :

Portfolio investments are investments in the form of a group (portfolio) of assets, including transactions in equity securities, such as common stock, and debt securities, such as banknotes, bonds, and debentures.

Portfolio investments are passive investments, as they do not entail active management or control of the issuing company. Rather, the purpose of the investment is solely financial gain, in contrast to foreign direct investment (FDI), which allows an investor to exercise a certain degree of managerial control over a company. For international transactions, equity investments where the owner holds less than 10% of a company's shares are classified as portfolio investments. These transactions are also referred to as "portfolio flows" and are recorded in the financial account of a country's balance of payments.

They are categorized in two major parts: foreign institutional investment and investments by non-residents. According to the Institute of International Finance, portfolio flows arise through the transfer of ownership of securities from one country to another.

Portfolio investment covers a range of securities, such as stocks and bonds, as well as other types of investment vehicles. A diversified portfolio helps spread the risk of possible loss because of below-expectations performance of one or a few of them.

93. Moving towards creating a holding company structure for PSBs, the govt announced the setting up of the BBB which will recommend appointment of directors in PSBs. The term BBB stands for

A) Banks Board BureauB) Banks Base BureauC) Banks Balancing BureauD) Banks Basal BureauE) Other than those given as optionsCorrect answer: A

94. What does the letter ‘I’ denote in the term DICGC as used in the banking sector?

A) IndiaB) IndustrialC) InfrastructureD) InsuranceE) InitiativeCorrect answer: D

95. The participatory notes are a part of ODIs, an investment vehicle used by the investors who are not registered with SEBI. What is the full form of ODI as used above?

A) Ordinary Derivatives InstrumentB) Original Derivatives InstrumentC) Open Derivatives InstrumentD) Obsolete Derivatives InstrumentE) Offshore Derivatives InstrumentCorrect answer: E

96. If a savings account is opened with a bank on the basis of simplified KYC norms, the account would additionally be treated as a

A) BSBDAB) No-frills accountC) Small AccountD) Current AccountE) Other than those given as optionsCorrect answer: C

Solution : Small Accounts

The Notification 'small account' means a savings account in a banking company where -

(i) The aggregate of all credits in a financial year does not exceed rupees one lakh;

(ii) The aggregate of all withdrawals and transfers in a month does not exceed rupees ten thousand; and

(iii) The balance at any point of time does not exceed rupees fifty thousand.

97. What does the letter ‘E’ denote in the term ‘NEFT’?

A) ElectronicB) EfficientC) ExternalD) Enforced

E) EconomicCorrect answer: A

Solution : National Electronic Funds Transfer (NEFT) is one of the most prominent electronic funds transfer systems of India. Started in November 2005, NEFT is a facility provided to bank customers to enable them to transfer funds easily and securely on a one-to-one basis. It is done via electronic messages. This is not on real-time basis like RTGS (Real Time Gross Settlement). This is a "net" transfer facility which is executed in hourly batches resulting in a time lag. NEFT facilities are available in 30,000 bank branches all over the country and work on a batch mode.

RBI explains this scheme as "National Electronic Funds Transfer (NEFT) is a nation-wide payment system facilitating one-to-one funds transfer. Under this Scheme, individuals, firms and corporates can electronically transfer funds from any bank branch to any individual, firm or corporate having an account with any other bank branch in the country participating in the Scheme."

NEFT has gained popularity due to it saving on time and the ease with which the transactions can be concluded, this reflects from the fact that 42% of all electronic transactions in the 2008 financial year were NEFT transactions.

98. Which of the following is NOT a subsidiary of the RBI?

A) DICGCB) NHBC) NABARDD) BRBNMPLE) Other than those given as optionsCorrect answer: E

Solution : RBI has four subsidiaries viz. Deposit Insurance and Credit Guarantee Corporation, DICGC; National Housing Bank; Bharatiya Reserve Bank Note Mudran Private Limited (BRBNMPL) and NABARD.

99. Credit lending is NOT allowed in case of which of the following type of banks?

A) Small BanksB) Payments BanksC) Cooperative BanksD) RRBs E) Foreign Banks

Correct answer: B

Solution : 1. Payment bank is to increase financial inclusion by providing small saving account, payment/remittance service to migrant labour, low income households, and small business.

2. Payment bank can be a non –bank PPIs, NBFCs, Corporate, Mobile telephone companies, super market chain real sector cooperative companies and public sector bank. It can take equity in payment banks.

3. It can be accepted demand deposit only current account and saving account. Payments banks would initially be restricted to holding a maximum balance of Rs.1 lac per customer.

4. Payments banks can offer payment and remittance services, issuance of prepaid payment instruments, internet banking for other banks.

5. They cannot setup subsidiaries to undertake NBFC Business.

6. Payment banks would be required to use the word “payment ‘it is named to differentiate it from other banks.

7. There will be no Credit Lending is allowed for payments bank

100. The central govt’s scheme for financial restructuring of debt of power distribution companies is named

A) SAVERAB) SAMBHAVC) UDAYD) SHAKTIE) ROSHNICorrect answer: C

Solution : Ujwal DISCOM Assurance Yojana (UDAY) is the financial turnaround and revival package for electricity distribution companies of India (DISCOMs) initiated by the Government of India with the intent to find a permanent solution to the financial mess that the power distribution is in.

The scheme comprises four initiatives –

1. Improving operational efficiencies of discoms

2. Reduction of cost of power

3. Reduction in interest cost of discoms

4. Enforcing financial discipline on discoms through alignment with state finances

It allows state governments, which own the discoms, to take over 75 percent of their debt as of September 30, 2015, and pay back lenders by selling bonds. Discoms are expected to issue bonds for the remaining 25 percent of their debt.

Features of the scheme

1. States shall take over 75% of DISCOM debt as on 30 September 2015 over two years - 50% of DISCOM debt shall be taken over in 2015-16 and 25% in 2016-17.

2. Government of India will not include the debt taken over by the States as per the above scheme in the calculation of fiscal deficit of respective States in the financial years 2015-16 and 2016-17.

3. States will issue non-SLR including SDL bonds in the market or directly to the respective banks / Financial Institutions (FIs) holding the DISCOM debt to the appropriate extent.

4. DISCOM debt not taken over by the State shall be converted by the Banks / FIs into loans or bonds with interest rate not more than the bank’s base rate plus 0.1%. Alternately, this debt may be fully or partly issued by the DISCOM as State guaranteed DISCOM bonds at the prevailing market rates which shall be equal to or less than bank base rate plus 0.1%.

5. States shall take over the future losses of DISCOMs in a graded manner.

6. State DISCOMs will comply with the Renewable Purchase Obligation (RPO) outstanding since 1 April 2012, within a period to be decided in consultation with Ministry of Power.

7. States accepting UDAY and performing as per operational milestones will be given additional / priority funding through Deendayal Upadhyaya Gram Jyoti Yojana (DDUGJY),Integrated Power Development Scheme (IPDS), Power Sector Development Fund (PSDF) or other such schemes of Ministry of Power and Ministry of New and Renewable Energy.

8. Such States shall also be supported with additional coal at notified prices and, in case of availability through higher capacity utilization, low cost power from NTPC and other Central Public Sector Undertakings (CPSUs).

9. States not meeting operational milestones will be liable to forfeit their claim on IPDS and DDUGJY grants.

101. What is the minimum paid-up capital requirement for setting up a new private sector bank in India?

A) 100 crB) 200 crC) 500 crD) 800 crE) 1000 crCorrect answer: C

102. The Financial Stability and Development Council (FSDC) is headed by

A) Chief Economic Advisor, Ministry of FinanceB) Finance SecretaryC) Governor RBID) Union Finance MinisterE) Chairman, SEBICorrect answer: D

103. Which of the following PSBs is NOT headquartered in Mumbai?

A) Bank of BarodaB) Allahabad BankC) Bank of IndiaD) IDBI BankE) Central Bank of IndiaCorrect answer: B

104. Country’s first E-ration card has been launched in

A) MaharashtraB) RajasthanC) DelhiD) GujaratE) Tamil NaduCorrect answer: C

105. Currently the rate of interest payable in public provident fund account is

A) 8.9 per centB) 8.7 per centC) Other than those given as optionsD) 9 per centE) 9.8 per centCorrect answer: B

106. The headquarters of the United Nations Organization (UNO) is located in

A) LondonB) GenevaC) New YorkD) ViennaE) ParisCorrect answer: C

107. RBI has almost finalised the structure of the registry which will enable quick sharing of information about unstructured borrowers and help banks fight bad loans. The registry is called

A) Central RegistryB) CIBILC) Fraudulent Borrowers’ ListD) RBI Wilful Defaulter ListE) Central Fraud RegistryCorrect answer: E

108. The annual meeting of the World Economic Forum (WEF) was recently held at

A) Davos, SwitzerlandB) Berlin, GermanyC) Dublin, IrelandD) Amsterdam, NetherlandsE) Madrid, SpainCorrect answer: A

109. Reserve bank of India constituted a working group on Benchmark Prime Lending Rate (BPLR) system. In the light of the comments/suggestions received, it was decided that banks will patch over to the system of base rate. Who was the chairman of this committee?

A) S PadmanabhanB) PK MohantyC) Deepak MohantyD) SS KohliE) Usha ThoratCorrect answer: C

110. Public Debt Management Agency (PDMA) is being set up to prevent leakages and development of the

A) Treasury marketB) Bond marketC) Money marketD) Capital marketE) Call money marketCorrect answer: B

111. The record of all economic transactions between the residents of a country and the rest of the world in a particular period is known as

A) Balance in Capital AccountB) Balance in Current AccountC) Trade settlementsD) Balance of Payments E) Balance of TradeCorrect answer: D

Solution : The balance of payments, also known as balance of international payments and abbreviated BoP, of a country is the record of all economic transactions between the residents of the country and the rest of the world in a particular period (over a quarter of a year or more commonly over a year). These transactions are made by individuals, firms and government bodies. Thus the balance of payments includes all external visible and non-visible transactions of a country. It represents a summation of country's current demand and supply of the claims on foreign currencies and of foreign claims on its currency[1] .[2] These transactions include payments for the country's exports and imports of goods, services, financial capital, and financial transfers. It is prepared in a single currency, typically the domestic currency for the country concerned.

Sources of funds for a nation, such as exports or the receipts of loans and investments, are recorded as positive or surplus items. Uses of funds, such as for imports or to invest in foreign countries, are recorded as negative or deficit items.

112. A Rs.20,000-crore bank which would primarily be responsible for refinancing all micro-finance institutions, is to be launched. This unique bank is christened as

A) MSE BankB) MSME BankC) MUDRA BankD) SAMUDRA BankE) SSI BankCorrect answer: C

Solution : The principal objectives of the MUDRA Bank are:

1. Regulate the lender and the borrower of microfinance and bring stability to the microfinance system through regulation and inclusive participation.

2. Extend finance and credit support to Microfinance Institutions (MFI) and agencies that lend money to small businesses, retailers, self-help groups and individuals.

3. Register all MFIs and introduce a system of performance rating and accreditation for the first time. This will help last-mile borrowers of finance to evaluate and approach the MFI that meets their requirement best and whose past record is most satisfactory. This will also introduce an element of competitiveness among the MFIs. The ultimate beneficiary will be the borrower.

4. Provide structured guidelines for the borrowers to follow to avoid failure of business or take corrective steps in time. MUDRA will help in laying down guidelines or acceptable procedures to be followed by the lenders to recover money in cases of default.

5. Develop the standardised covenants that will form the backbone of the last-mile business in future.

6. Offer a Credit Guarantee scheme for providing guarantees to loans being offered to micro businesses.

7. Introduce appropriate technologies to assist in the process of efficient lending, borrowing and monitoring of distributed capital.

8. Build a suitable framework under the Pradhan Mantri MUDRA Yojana for developing an efficient last-mile credit delivery system to small and micro businesses.

113. The participatory notes are a part of ODIs, an investment vehicle used by the investors who are not registered with SEBI. What is the full form of ODI as used above?

A) Ordinary Derivatives InstrumentB) Original Derivatives InstrumentC) Open Derivatives InstrumentD) Obsolete Derivatives InstrumentE) Offshore Derivatives InstrumentCorrect answer: E

114. The “National Consumer Rights Day” is celebrated every year on

A) 21st DecemberB) 5th MarchC) 24th OctoberD) 24th DecemberE) 8th MarchCorrect answer: D

115. The RBI imposed Rs.1-cr penalty on which of the following private sector banks for violation of KYC and Anti Money Laundering (AML) norms recently?

A) Federal BankB) IndusInd BankC) Dhanlaxmi BankD) Kotak Mahindra BankE) South Indian BankCorrect answer: C

116. Reverse mortgage is a financial product which is specially designed for

A) Senior citizens (60+)B) StudentsC) Property dealersD) FarmersE) ExportersCorrect answer: A

117. The public sector bank Punjab National Bank (PNB) is headquartered at

A) AmritsarB) ChandigarhC) MumbaiD) New DelhiE) PatialaCorrect answer: D

118. Which of the following is a card scheme conceived and launched by the National Payments Corporation of India (NPCI)?

A) Visa debit cardB) Maestro debit cardC) RuPay debit cardD) MasterCardE) Other than those given as optionsCorrect answer: C

119. In the banking sector, the term IMPS stands for

A) Interbank Payment ServiceB) Indian Payment ServiceC) International Payment ServiceD) Immediate Payment ServiceE) Intermediate Payment ServiceCorrect answer: D

Solution : Immediate Payment Service (IMPS) is an instant real-time inter-bank electronic funds transfer system of India. IMPS offer an inter-bank electronic fund transfer service through mobile phones. Unlike NEFT and RTGS, the service is available 24/7 throughout the year including bank holidays. It is managed by the National Payments Corporation of India (NPCI) and is built upon the existing National Financial Switch network. In 2010, the NPCI initially carried out a pilot for the mobile payment system with 4 member banks (State Bank of India, Bank of India, Union Bank of India and ICICI Bank), and expanded it to include Yes Bank, Axis Bank and HDFC Bank later that year. IMPS was publicly launched on November 22nd, 2010.

120. The newly launched IDFC Bank and Bandhan Bank will be included in which of the following categories of banks in India?

A) Small BanksB) Payments BanksC) Foreign BanksD) Private Sector BanksE) Public Sector BanksCorrect answer: D

121. The CTS or Image-based Clearing System is a project undertaken by the RBI in 2008, for faster clearing of cheques. What does letter ‘T’ denote in the term ‘CTS’?

A) TransactionB) TransportationC) TransferD) TruncationE) TracingCorrect answer: D

122. A person writes the various details including the name of a person/company on the cheque, and signs it, ordering his bank to pay that person/company the amount of money stated. Here, the person who writes and signs the cheques is

A) draweeB) payeeC) drawerD) introducerE) Other than those given as optionsCorrect answer: C

123. Which of the following coins is called ‘small coin’?

A) 50 paiseB) One rupeeC) Two rupeesD) Five rupeesE) All the aboveCorrect answer: A

124. The Executive Board of the IMF has included renminbi (yuan) into its basket of currencies that make up the SDR. The term SDR stands for

A) Specific Drawing RightB) Special Drawing RightC) Structured Drawing RightD) Systematic Drawing RightE) None of theseCorrect answer: B

Solution : The SDR is an international reserve asset, created by the IMF in 1969 to supplement its member countries' official reserves. Its value is currently based on a basket of four major currencies, and the basket will be expanded to include the Chinese Renminbi (RMB) as the fifth currency, effective October 1, 2016.

Currently, the value of an SDR is based on a basket of four currencies: the euro, Japanese yen, pound sterling, and the dollar. At Monday's meeting, a decision will be made on whether the yuan should be added to this group. It's important to note that the SDR is not a currency nor a claim on the IMF.

125. The Finance Ministry allowed 41 more housing finance companies to use the SARFAESI law, which helps firms in

A) maximising profitB) managing workforceC) recovery of duesD) new product launchE) NoneCorrect answer: C

Solution : The Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 (also known as the Sarfaesi Act) is an Indian law .It allows banks and other financial institution to auction residential or commercial properties to recover loans. The first asset reconstruction company (ARC) of India, ARCIL, was set up under this act.

Under this act secured creditors (banks or financial institutions) have many rights for enforcement of security interest under section 13 of SARFAESI Act, 2002. If borrower of financial assistance makes any default in repayment of loan or any instalment and his account is classified as Nonperforming Asset by secured creditor, then secured creditor may require before expiry of period of limitation by written notice to the borrower for repayment of due in full

within 60 days by clearly stating amount due and intention for enforcement. Where he does not discharge dues in full within 60 days, then without intervention of any court or tribunal Secured creditor may take possession (including sale, lease, assignment) of secured asset, or take over management of business of borrower or appoint manager for secured asset or without taking any of these action may also proceed against guarantor or sell the pledged asset, if any.

126. Which of the following statements is NOT correct about GDP?

A) It is the value of all the final goods and services produced within the country.B) It stands for Gross Domestic Product.C) Intermediate goods and services are not included in GDP.D) It is the total domestic and foreign output claimed by residents of a countryE) NoneCorrect answer: D

127. Which of the following pairs of institutions and their heads is NOT matched correctly?

A) NITI Aayog – Prime MinisterB) FSDC – Union Finance MinisterC) NDRF – Union Home MinisterD) All are correctE) NoneCorrect answer: C

128. The devaluation of currency leads to which of the following?

A) Expansion of importB) Expansion of exportC) Expansion of export substitutionD) All the aboveE) NoneCorrect answer: B

129. What is the full form of CBDT as used in banking/finance?

A) Central Board of Deductible TaxesB) Central Board of Derived TaxesC) Central Board of Domestic TaxesD) Central Board of Direct Taxes

E) All the aboveCorrect answer: D

130. A customer may have complaints regarding certain services of the bank. The ________ enables an expeditious and inexpensive forum to bank customers for resolution of such complaints.

A) High courtB) National consumer forumC) Banking ombudsman schemeD) Other than those given as optionsE) DRTCorrect answer: C

131. Britain’s largest state-owned bank has recently decided to shut down its banking operations in India. Name the bank.

A) Lloyd’s BankB) Standard CharteredC) Barclays BankD) Royal Bank of Scotland (RBS)E) HSBCCorrect answer: D

132. The latest addition in the group of borrowers falling under the ‘category of weaker section’ as per priority sector lending norms is

A) illiteratesB) OBCC) MSME borrowersD) person with disabilitiesE) transgenderCorrect answer: C

133. The third instalment of the Basel accords was developed in response to the deficiencies in financial regulations revealed by financial crisis of 2007-08. Basel II was supposed to strengthen bank capital requirements by increasing bank liquidity and decreasing bank leverage. The

transitional period for full implementation of Basel III capital regulations in India is extended upto

A) 31st March 2020B) 31st March 2016C) 31st March 2017D) 31st March 2018E) 31st March 2019Correct answer: E

134. Who finalises the value and the volume of the notes to be printed every year?

A) Independently by Ministry of FinanceB) With Mutual Consultation of the RBI and the Ministry of FinanceC) Independently by the Government of IndiaD) Committee of Bank HeadsE) With Mutual Consultation of the Government of India and Bank HeadsCorrect answer: B

135. The National Payments Corporation of India (NPCI) has developed an application to connect payments across smartphones. The application is

A) Unified Payments InterfaceB) Payment InterfaceC) Unique Payment InterfaceD) Union of Payment InterfaceE) People’s Payment InterfaceCorrect answer: A

Solution : National Payments Corporation of India (NPCI) is the umbrella organisation for all retail payment systems in India, with a vision to enable citizens of the country to have access to e-payment services at anyplace and anytime.

Founded in 2008, NPCI is a not-for-profit organisation registered under section 25 of the Companies Act, 2013. The organisation has been promoted by the country’s central bank, the Reserve Bank of India.

It has successfully completed the development of a domestic card payment network called RuPay, reducing the dependency on international card schemes. The RuPay card is now accepted at all the ATMs (2,22,278+)*, Point of Sale (PoS) terminals (12,20,763+)* and most of the e-

Com merchants (30,000+)* in the country. More than 300* Cooperative banks and the Regional Rural Banks (RRBs) in the country have also issued RuPay ATM cards.

More than 250 million* cards are being issued by various banks, and it is growing at a rate of about 3 million per month. A variant of the card called ‘Kisan Card’ is now being issued by all the Public Sector banks in addition to the mainstream debit card which has been issued by 43 banks. RuPay cards are also issued under the Pradhan Mantri Jan Dhan Yojna Scheme. RuPay card was dedicated to the nation by the H’ble President Pranab Mukherjee on 8th May, 2014.

136. e-KYC is possible only for those who have

A) PAN numberB) Driving LicenseC) Other than those given as optionsD) Aadhaar NumberE) Ration cardCorrect answer: D

137. As per the latest bipartite settlement, the salary of the bank employees, mostly from the public sector, will get a 15 per cent wage hike and two additional holidays a month as part of an industry-wide wage settlement. This is the ________ bipartite settlement.

A) EighthB) EleventhC) TenthD) NinthE) TwelfthCorrect answer: C

138. The practice of lending money to unrelated individuals, or “peers”, without going through a traditional financial intermediary such as a bank or other traditional financial institution is called

A) P2P lendingB) B2B transactionsC) P2P investingD) PPP modelE) C2C transactionCorrect answer: A

Solution : Peer-to-peer lending (P2P) is a method of debt financing that enables individuals to borrow and lend money - without the use of an official financial institution as an intermediary. Peer-to-peer lending removes the middleman from the process, but it also involves more time, effort and risk than the general brick-and-mortar lending scenarios.

139. The rate at which RBI borrows money from commercial banks within the country is known as

A) Reverse Repo RateB) Base RateC) Savings Deposit RateD) Bank RateE) Repo RateCorrect answer: A

Solution : Reverse Repo rate is the short term borrowing rate at which RBI borrows money from banks. The Reserve bank uses this tool when it feels there is too much money floating in the banking system. An increase in the reverse repo rate means that the banks will get a higher rate of interest from RBI.

140. Banks cannot generally accept interest-free deposits. Which of the following is an exception to this rule?

A) Current accountB) Savings Account of MinorsC) Deposit from minority groupsD) Other than those given as optionsE) BSBDACorrect answer: A

141. Who can open a BSBD (Basic Savings Bank Deposit) Account?

A) Only customers from the weaker sectionsB) Only customers below poverty lineC) Only loanees under priority sector advanceD) Only members of a self-help groupE) All customersCorrect answer: E

Solution : RBI in 2012 came out with fresh guidelines and asked banks to offer a ‘Basic Savings Bank Deposit Account’ which will offer following minimum common facilities to all their customers. These guidelines inter-alia includes:-

1. This account shall not have the requirement of any minimum balance.

2. The services available in the account will include deposit and withdrawal of cash at bank branch as well as ATMs; receipt/credit of money through electronic payment channels or by means of deposit/collection of cheques drawn by Central/State Government agencies and departments;

3. While there will be no limit on the number of deposits that can be made in a month, account holders will be allowed a maximum of four withdrawals in a month, including ATM withdrawals; and

4. Facility of ATM card or ATM-cum-Debit Card;

As per RBI guidelines the above facilities are to be provided without any charges. Further, no charge will be levied for non-operation/activation of in-operative ‘Basic Savings Bank Deposit Account’.

However, RBI allowed banks to evolve other requirements including pricing structure for additional value-added services beyond the stipulated basic minimum services on reasonable and transparent basis and applied in a non-discriminatory manner.

The ‘Basic Savings Bank Deposit Account’ is subject to KYC / AML requirements for opening of bank accounts issued from time to time. BSBDA would be subject to provisions of PML Act and Rules and RBI instructions on Know Your Customer (KYC) / Anti-Money Laundering (AML) for opening of bank accounts issued from time to time. BSBDA can also be opened with simplified KYC norms. However, if BSBDA is opened on the basis of Simplified KYC, the accounts would additionally be treated as “BSBDA-SMALL account” and would be subject to the conditions stipulated for such accounts

142. What is the full form of the term NIIF? It is an investment vehicle for funding commercially viable greenfield, brownfield and stalled projects.

A) National Innovation and Infrastructure FundB) National Investment and Innovation FundC) National Investment and Infrastructure FundD) National Integrated Infrastructure FundE) Other than those given as options

Correct answer: C

143. An individual can have all the following accounts in the same bank while holding a ‘Basic Savings Bank Deposit Account’ except

A) Term/Fixed DepositB) Recurring DepositC) Savings Bank AccountD) Loan AccountE) None of the aboveCorrect answer: C

144. Which of the following banks are NOT eligible to implement the Gold Monetisation Scheme (GMS) launched by the govt?

A) Private Sector BanksB) Foreign BanksC) Public Sector BanksD) RRBsE) Other than those given as optionsCorrect answer: D

Solution : Gold Monetization Scheme

The Gold Monetization Scheme was launched on 5th November by the Prime Minister Narenda Modi. The scheme is designed to help you earn interest on your unused gold lying idle in bank lockers. The Gold Monetization Scheme is basically a new deposit tool to ensure mobilization of gold possessed by various families and institutions in India. It is expected that the scheme would turn gold into a productive asset in India. This new gold scheme is a modification of the existing Gold Deposit Scheme (GDS) and Gold Metal Loan Scheme (GML), and it would replace the existing Gold Deposit Scheme, 1999.

Key features of Gold Monetization Scheme

The Gold Monetization Scheme comes with the following features:

The scheme accepts a minimum deposit of 30gm of raw gold in the form of a bar, coin or jewelry.

There is no maximum limit of investment under this scheme.

The scheme allows premature withdrawal after a minimum lock-in period. However, it charges penalty for such withdrawals.

All designated commercial banks would be able to implement the Gold Monetization Scheme in India.

The scheme would offer interest at 2.50% per year which is higher than previous rates offered on gold investments.

The short term deposits offered by Gold Monetization Scheme can be redeemed in either gold or in rupees at current rates applicable at the time of redemption.

145. Lending to which of the following categories will NOT come under the priority sector lending by banks?

A) Medium enterprisesB) Social infrastructureC) Renewable energyD) Export CreditE) Other than those given as optionsCorrect answer: E

146. The lenders invoked SDR scheme introduced by the RBI for the first time in case of Electrosteel Steels recently. What is the full form of the term SDR in this regard?

A) Specific Drawing RightsB) Strategic Drawing RightsC) Strategic Debt RestructuringD) Specific Default RestructuringE) Other than those given as optionsCorrect answer: C

147. The Commercial Paper (CP) is an unsecured money market instrument which can be issued for maturities between a minimum of 7 days and a maximum of up to

A) three monthsB) six monthsC) one yearD) two yearsE) five years

Correct answer: C

148. In the event of a bank failure, the deposit insurance and credit guarantee corporation (DICGC) protects all bank deposits that are payable in India except

A) SavingsB) FixedC) CurrentD) RecurringE) Other than those given as optionsCorrect answer: E

149. Which of the following financial institutions can neither accept demand deposits nor issue cheques drawn on itself?

A) NBFCsB) RRBsC) Payments BanksD) Foreign BanksE) Other than those given as optionsCorrect answer: A

Solution : Non-bank financial companies (NBFCs) are financial institutions that provide banking services without meeting the legal definition of a bank, i.e. one that does not hold a banking license. These institutions typically are restricted from taking deposits from the public depending on the jurisdiction. Nonetheless, operations of these institutions are often still covered under a country's banking regulations.

The specific banking products that can be offered by NBFCs depends on the jurisdiction, and may include services such as loans and credit facilities, savings products, investments and money transfer services. In some jurisdictions, such as New Zealand, any company can engage in banking business, except they are not allowed to use the word bank in their name. A company can only call itself a bank if it is a registered as such with the nation's central bank.

150. The Indian financial system code (IFSC) is an alpha-numeric code that uniquely identifies a bank-branch participating in the NEFT system. This code contains how many characters?

A) 12B) 11

C) 10D) 9E) 7Correct answer: B

151. Which of the following cities is known as the ‘city of Destiny’?

A) ChennaiB) NagpurC) AjmerD) VisakhapatnamE) BengaluruCorrect answer: D

152. According to RBI guidelines, Payments Banks will not be allowed to issue

A) Debit cardsB) Credit cardsC) Prepaid cardsD) ATM cardsE) Gift cardsCorrect answer: B

153. The Employees’ Provident Fund Organisation (abbreviated as EPFO) is a statutory body of the Government of India under the

A) Ministry of FinanceB) Ministry of Labour and EmploymentC) Ministry of Personnel, Public Grievances and PensionD) Ministry of Human Resources DevelopmentE) Ministry of Social Justice and EmpowermentCorrect answer: B

154. The Credit Guarantee Corpus of the newly launched Micro Unit Development and Refinance Agency (MUDRA) will be

A) Rs 4,000 croreB) Rs 5,000 crore

C) Rs 5,500 croreD) Rs 6,000 croreE) Rs 3,000 croreCorrect answer: E

Solution : The Micro Units Development and Refinance Agency (known as the MUDRA Bank) launched in April 8, 2015 which would primarily be responsible for regulating micro and small enterprise financing business, and supporting them. Prime Minister Narendra Modi will launch the 20,000 crore ( INR 200 billion) MUDRA Bank that aims to provide refinancing to small and medium enterprises, particularly those belonging to members of scheduled castes and scheduled tribes. According to Narendra Modi, the bank would help over six crore families. The bank would also get an additional 3,000 crore (INR 30 billion) in the budget to create a credit guarantee corpus for guaranteeing loans being provided to the micro enterprises.

MUDRA Bank will offer loans under three schemes-Shishu-upto INR 50,000,Kishor up to INR 5 Lac and Tarun up to INR 10 Lac - based on stage of micro business. MUDRA Bank will also register MFIs and be responsible for accreditation and rating of MFI. It will also lay down policies for proper last mile practices to be followed by MFI to prevent indebtedness and provide proper client protection.

Mudra Bank stands for Micro Units Development Refinance Agency (MUDRA). Also, Mudra, in Hindi, means currency.

Setting up

Mudra Bank is being set up through a statutory enactment and will be responsible for developing and refinancing through a Pradhan Mantri MUDRA Yojana.

Last mile financiers

Since small entreprenuers are businssess are often cut off from banking system because of limited branch presence, Mudra Bank will partner with local coordinators and provide finance to "Last Mile Financiers" of small/micro businesses.

Targets

The Finance Ministry said measures to be taken up by MUDRA are targeted towards mainstreaming young, educated or skilled workers and entrepreneurs including women entrepreneurs.

5.77 crore

The bank will cater to 5.77 crore small business units that are spread all across India who currently find it difficult to access credit from the regular banking system.

Recovery method

Mudra Bank will ensure clients are properly protected and will lay down principles and methods of loan recovery in case of a default. The Bank will also rigidly follow "responsible financing practices" so deter borrowers from indebtedness.

Corpus

The Bank will be set up with a corpus of Rs 20,000 crore and a credit guarantee fund of Rs 2,000 crore.

Shishu/Kishor/Tarun

The Bank will nurture small businesses through different stages of growth and development of businesses termed as Shishu, Kishor and Tarun.

Shishu

This is will be the first step when the business is just starting up. The loan cover in this stage will be upto Rs 50,000.

Kishor

In this stage, the entrepreneur will be eligible for a loan ranging from Rs 50,000 to Rs 5 lakh.

Tarun

This last and final category will provide loans for upto Rs 10 lakh.

155. Under the Pradhan Mantri Suraksha Bima Yojana (PMSBY), the maximum insurance cover for ‘accidental cover’ is

A) Rs three lakhB) Rs four lakhC) Rs one lakhD) Rs five lakhE) Rs two lakhCorrect answer: E

Solution :

Pradhan Mantri Suraksha Bima Yojana is a government-backed accident insurance scheme in India. It was originally mentioned in the 2015 Budget speech by Finance Minister Arun Jaitley in February 2015. It was formally launched by Prime Minister Narendra Modi on 9 May in Kolkata. As of May 2015, only 20% of India's population has any kind of insurance, this scheme aims to increase the number.

Pradhan Mantri Suraksha Bima Yojana is available to people between 18 and 70 years of age with bank accounts. It has an annual premium of 12 (18¢ US) excluding service tax, which is about 14% of the premium. The amount will be automatically debited from the account. In case of accidental death or full disability, the payment to the nominee will be 2 lakh (US$3,000) and in case of partial Permanent disability 1 lakh (US$1,500). Full disability has been defined as loss of use in eyes, hands or feet. Partial Permanent disability has been defined as loss of use in one eye, hand or foot.

This scheme will be linked to the bank accounts opened under the Pradhan Mantri Jan Dhan Yojana scheme. Most of these account had zero balance initially. The government aims to reduce the number of such zero balance accounts by using this and related schemes.

156. The Government of India has recently announced that over the next five years Rs50,000 crore to farmers shall be provided under the

A) PMKSYB) PMJDYC) PMJJBYD) PMKVYE) PMGSYCorrect answer: A

Solution : Pradhan Mantri Krishi Sinchai Yojana (PMKSY) is a national mission to improve farm productivity and ensure better utilization of the resources in the country. The budget of 500 ₹billion (US$7.4 billion) in a time span of five years has been allocated to this scheme. The decision was taken on 1 July 2015 at the meeting of Cabinet Committee on Economic Affairs (CCEA), which in turn was headed by the Prime Minister, Narendra Modi.

The primary objectives of PMKSY are to attract investments in irrigation system at field level, develop and expand cultivable land in the country, enhance ranch water use in order to minimize wastage of water, enhance crop per drop by implementing water-saving technologies and precision irrigation. The plan additionally calls for bringing ministries, offices, organizations, research and financial institutions occupied with creation and recycling of water under one platform so that an exhaustive and holistic outlook of the whole water cycle is considered. The goal is to open the doors for optimal water budgeting in all sectors.

157. ‘MIBOR’ is calculated every day by the National Stock Exchange as a weighted average of lending rates of a group of banks, on funds lent to first-class borrowers. The alphabet ‘I’ in the abbreviation ‘MIBOR’ stands for

A) IndexB) InterestC) InvestmentD) InterbankE) InternationalCorrect answer: D

158. The RBI panel which has recently recommended converting urban cooperative banks (UCB) with business more than Rs20,000 crores, into banks, was headed by the RBI deputy governor

A) SS MundraB) HR KhanC) Anand SinhaD) R GandhiE) Dr Urjit PatelCorrect answer: D

159. The majority shareholder in the share capital of ‘Bank of Baroda’ is

A) Reserve Bank of IndiaB) Banks/Insurance CompaniesC) Government of IndiaD) Corporates/lndividualsE) NRI/Foreign Institutional InvestorsCorrect answer: C

160. The process of gathering funds from several investors through a web-based platform for a project or business venture is called

A) Crowd FundingB) Angel FundingC) Private Equity FundingD) Venture Capital FundingE) Micro FinancingCorrect answer: A

161. ‘Allahabad Bank’ is a nationalised bank with its headquarters in

A) BengaluruB) New DelhiC) KolkataD) MumbaiE) ChennaiCorrect answer: C

162. Which PSB has entered into a partnership with Thomas Cook India to offer the Thomas Cook Holiday savings account to its customers?

A) State Bank of IndiaB) Punjab National BankC) Corporation BankD) Bank of BarodaE) Indian Overseas BankCorrect answer: A

163. The private lender Bandhan Bank has launched NRI banking facilities recently. The bank is headquartered at

A) MumbaiB) KolkataC) BhubaneswarD) Bhopal E) BengaluruCorrect answer: B

164. The deposit account maintained with a commercial bank in which there is no limit on the number of withdrawals/deposits is a

A) recurring accountB) term deposit accountC) savings accountD) current accountE) Other than those given as options

Correct answer: D

Solution : Current account is one of the two component accounts of the balance of payments of a nation. It records the trade of goods and services of an economy with other countries of the world.

Current account includes three components - net exchange i.e. exports minus imports of goods, net exchange of services and net transfers to and from the country. The balance in this account before accounting for the transfer component is generally referred to as the balance of trade. In India, current account is reported by the Reserve Bank of India.

165. In the money market, when the money is borrowed or lent for a period between 2 days and 14 days, it is known as

A) Term MoneyB) Notice MoneyC) Hot MoneyD) Cold MoneyE) Transit MoneyCorrect answer: B

Solution : Call money is short-term finance repayable on demand, with a maturity period of one to fourteen days or overnight to fortnight. It is used for inter-bank transactions. The money that is lent for one day in this market is known as "call money" and, if it exceeds one day, is referred to as "notice money.

166. Treasury bills are govt bonds or debt securities with maturity of less than

A) three monthsB) six monthsC) nine monthsD) a yearE) five yearsCorrect answer: D

167. Which of the following is NOT a money market instrument?

A) Certificate of DepositB) Commercial PaperC) Repurchase Agreement

D) Banker’s AcceptanceE) Other than those given as optionsCorrect answer: E

168. Which of the following is NOT a negotiable instrument?

A) Bank draftB) BanknoteC) ChequeD) Promissory noteE) Bill of exchangeCorrect answer: B

169. ICICI Bank launched country’s first contactless debit and credit cards that use the NFC technology. What is the full form of the term NFC?

A) Nested Field CommunicationB) Near Field ConnectionC) Narrow Field ConnectionD) Near Field CommunicationE) Other than those given as optionsCorrect answer: D

170. A cheque which a bank will not accept and exchange for money or payment because it was written more than a certain number of months ago, is called

A) post-dated chequeB) stale chequeC) crossed chequeD) at par chequeE) open chequeCorrect answer: D

171. The RBI introduced the Banking Ombudsman Scheme with effect from

A) 1955B) 1959C) 1980

D) 1991E) 1995Correct answer: E

172. As per the existing norms, govt equity in a public sector bank cannot go below

A) 75 per centB) 74 per centC) 58 per centD) 55 per centE) 52 per centCorrect answer: E

173. There are 27 public sector banks functioning in the country at present. Which of the following is NOT one of them?

A) Vijaya BankB) IDBI BankC) IDFC BankD) Dena BankE) Indian BankCorrect answer: C

174. In case of cash-based remittances using NEFT facility, the maximum amount per transaction within India and also for remittances to Nepal is limited to

A) `20,000B) `30,000C) `50,000D) `70,000E) `1 lakhCorrect answer: C

175. Which of the following is NOT a facility attached to debit cards issued by banks?

A) Cash withdrawal from ATMB) Purchase of goods and services at Point of SaleC) Purchase of goods and services onlineD) Fund transfer from one person to anotherE) Other than those given as optionsCorrect answer: E

176. A commercial paper (CP), an unsecured money market instrument, can be issued for a minimum maturity period of

A) 7 daysB) 14 daysC) 30 daysD) 45 daysE) 90 daysCorrect answer: A

177. Payments banks cannot

A) facilitate payments and remittancesB) sell mutual funds, insurance and pension productsC) disburse loansD) accept demand/savings deposits up to 1 lakhE) Other than those given as optionsCorrect answer: C

Solution : Objective of payments banks is to increase financial inclusion by providing small savings accounts, payment/remittance services to migrant labour, low income households, small businesses, other unorganised sector entities and other users by enabling high volume-low value transactions in deposits and payments/remittance services in a secured technology-driven environment.

Those who can promote a payments banks can be a non-bank PPIs, NBFCs, corporate’s, mobile telephone companies, super market chains, real sector cooperatives companies and public sector entities. Even banks can take equity in Payments Banks.

Payments Banks can accept demand deposits (only current account and savings accounts). They would initially be restricted to holding a maximum balance of Rs 100,000 per customer. Based on performance, the RBI could enhance this limit.

The banks can offer payments and remittance services, issuance of prepaid payment instruments, internet banking, functioning as business correspondent for other banks.

Payments Banks cannot set up subsidiaries to undertake NBFC business.

As in the case of Small Banks, other financial and non-financial services activities of the promoters should be ring-fenced.

The Payments Banks would be required to use the word ‘Payments’ in its name to differentiate it from other banks.

No credit lending is allowed for Payments Banks.

178. The RBI has decided to extend the SAARC Currency Swap Arrangement till Nov 14, 2017 under which it will be offering swap arrangement up to an overall amount of

A) USD 1 bnB) USD 2 bnC) USD 3 bnD) USD 4 bnE) USD 5 bnCorrect answer: B

179. The RBI has introduced CTS system to improve the efficiency of the cheque clearing cycle. The term CTS stands for

A) Cheque Transferring SystemB) Cheque Traversing SystemC) Cheque Truncation SystemD) Cheque Termination SystemE) Other than those given as optionsCorrect answer: C

Solution : Cheque Truncation System (CTS) or Image-based Clearing System (ICS), in India, is a project undertaken by the Reserve Bank of India (RBI) in 2008, for faster clearing of cheques. CTS is based on a cheque truncation or online image-based cheque clearing system where cheque images and magnetic ink character recognition (MICR) data are captured at the collecting bank branch and transmitted electronically.

Cheque truncation means stopping the flow of the physical cheques issued by a drawer to the drawee branch. The physical instrument is truncated at some point en route to the drawee branch and an electronic image of the cheque is sent to the drawee branch along with the relevant information like the MICR fields, date of presentation, presenting banks etc. This would eliminate the need to move the physical instruments across branches, except in exceptional circumstances, resulting in an effective reduction in the time required for payment of cheques, the associated cost of transit and delays in processing, etc., thus speeding up the process of collection or realization of cheques.

180. The RBI released a draft regulatory framework to allow the entry of a new kind of NBFC that can act as a(n)

A) small bankB) KYC facilitatorC) e-verifierD) credit aggregatorE) account aggregatorCorrect answer: E

Solution : Account aggregation is a method that involves compiling information from different accounts, which may include bank accounts, credit card accounts, investment accounts, and other consumer or business accounts, into a single place. This may include a database or may be provided through "screen scraping" where a user provides the requisite account-access information for an automated system to gather and compile the information into a single page. Usually this database resides in a web-based application or in client-side software. While such services are primarily designed to aggregate financial information, they sometimes also display other things such as the contents of e-mail boxes and news headlines.

181. What is the full form of the term CAGR, a useful measure of growth over multiple time periods?

A) Compound Audited Growth RateB) Calculated Annual Growth RateC) Compound Annual Growth Rate

D) Compound Annual Gross RateE) None of theseCorrect answer: C

Solution : The compound annual growth rate (CAGR) is a useful measure of growth over multiple time periods. It can be thought of as the growth rate that gets you from the initial investment value to the ending investment value if you assume that the investment has been compounding over the time period.

The formula for CAGR is:

CAGR = ( EV / BV)1 / n - 1

Where:

EV = Investment's ending value

BV = Investment's beginning value

n = Number of periods (months, years, etc.)

182. The International Bank for Reconstruction and Development (IBRD), a financial institution that offers loans to middle-income developing countries, is headquartered at

A) Washington DCB) New YorkC) LondonD) ParisE) BaselCorrect answer: A

183. Which of the following is the first micro finance company to transition into a full service bank in India?

A) BandhanB) IDFCC) SKSD) AsirvadE) Grameen Financial Services

Correct answer: A

184. The Banking Ombudsman is a senior official tasked with redressing customer complaints against deficiency in certain banking services and is appointed by the

A) Union Finance MinistryB) Supreme CourtC) RBID) IBAE) Concerned BankCorrect answer: C

185. In case of small finance banks in India, at least 50 per cent of their loan portfolio should constitute loans and advances of up to

A) Rs. 50 lakhB) Rs. 25 lakhC) Rs. 20 lakhD) Rs. 10 lakhE) Rs. 5 lakhCorrect answer: B

186. As announced by the RBI, the fixed-rate loans of up to what duration will have to be set by lenders based on their marginal cost of funding?

A) 3 yearsB) 5 yearsC) 7 yearsD) 9 yearsE) 10 yearsCorrect answer: A

187. Which of the following currencies is not included in the list of currencies used by the IMF as an international reserve asset?

A) YuanB) US dollarC) British pound

D) YenE) None of theseCorrect answer: E

188. Which of the following Indian PSBs is among the four new foreign banks allowed recently to open 100 per cent-owned branches in Myanmar?

A) Bank of BarodaB) Indian Overseas BankC) Punjab National BankD) State Bank of IndiaE) Canara BankCorrect answer: D

189. The German Development Bank KfW will provide loan assistance to metro system for which of the following cities?

A) LucknowB) PatnaC) NagpurD) ChennaiE) HyderabadCorrect answer: C

190. The International Bank for Reconstruction and Development (IBRD), a financial institution that offers loans to middle-income developing countries, is headquartered at

A) Washington DC B) New YorkC) LondonD) ParisE) BaselCorrect answer: A

191. Which of the following is the first micro finance company to transition into a full service bank in India?

A) Bandhan

B) IDFCC) SKSD) AsirvadE) Grameen Financial ServicesCorrect answer: A

192. The Banking Ombudsman is a senior official tasked with redressing customer complaints against deficiency in certain banking services and is appointed by the

A) Union Finance MinistryB) Supreme CourtC) RBID) IBAE) Concerned BankCorrect answer: C

193. In case of small finance banks in India, at least 50 per cent of their loan portfolio should constitute loans and advances of up to

A) Rs50 lakhB) Rs 25 lakhC) Rs 20 lakhD) Rs 10 lakhE) Rs 5 lakhCorrect answer: B

194. India signed an agreement with the IDB recently for a $100-mn line of credit. The term IDB stands for

A) Industrial Development BankB) International Development BankC) Islamic Development BankD) Indonesian Development BankE) None of theseCorrect answer: C

195. Under the recently launched ‘Stand Up India’ scheme, every bank branch will give loans to at least one SC/ST and one woman entrepreneur between `10 lakh and

A) Rs 20 lakhB) Rs 25 lakhC) Rs 50 lakhD) Rs 75 lakhE) Rs 1 crCorrect answer: E

Solution : Standup India was launched by Prime Minister Narendra Modi on 5 April 2016 to support entrepreneurship among women and SC & ST communities

Prime Minister Narendra Modi launched the ‘Stand up India’ scheme on 5 April 2016 as part of the government's efforts to support entrepreneurship among women and SC & ST communities.[1]

The scheme offers bank loans of between 10 lakh (US$15,000) and 1 crore (US$150,000) for ₹ ₹scheduled castes and scheduled tribes and women setting up new enterprises outside of the farm sector.[2]

Eligibility

1. SC/ST and/or Women entrepreneurs, above 18 years of age.

2. Loans under the scheme are available for only green field project. Green field signifies, in this context, the first time venture of the beneficiary in the manufacturing or services or trading sector.

3. In-case of non-individual enterprises, 51% of the shareholding and controlling stake should be held by either SC/ST and/or Women Entrepreneur.

4. Borrower should not be in default to any bank/financial institution.

196. As announced by the RBI, the fixed-rate loans of up to what duration will have to be set by lenders based on their marginal cost of funding?

A) 3 yearsB) 5 yearsC) 7 yearsD) 9 yearsE) 10 yearsCorrect answer: A

197. Which of the following currencies is not included in the list of currencies used by the IMF as an international reserve asset?

A) YuanB) US dollarC) British poundD) YenE) None of theseCorrect answer: E

198. Jiji Mammen is the present CEO of which of the following financial institutions?

A) SIDBIB) NABARDC) MUDRA BankD) IDBI BankE) NPCICorrect answer: C

199. Indian-American Nandita Bakshi is the new President and CEO of the Bank of the West which is a unit of

A) Deutsche BankB) Citi BankC) Standard CharteredD) BNP ParibasE) HSBCCorrect answer: D

200. The RBI reduced the policy repo rate under the LAF by 25 basis points recently. The term LAF means

A) Liquidity Addressing FacilityB) Liquidity Augmentation FacilityC) Liquidity Adjustment FacilityD) Liquidity Alteration FacilityE) Other than those given as optionsCorrect answer: C

Solution : On the basis of recommendations of second Narsimham Committee, 1998, an interim LAF was introduced in 1999 to provide a ceiling and the fixed rate repos were continued to provide a floor for money market rates. Liquidity Adjustment Facility was introduced for the first time from June 2000 onwards. Subsequent revisions were made in 2001 and 2004. The committee had recommended that RBI’s support to the market should be through a Liquidity Adjustment Facility (LAF) operated by way of repo and reverse repo providing a reasonable corridor to market players.

As mentioned above, the two components of LAF are repo rate and reverse repo rate. Under Repo, the banks borrow money from RBI to meet short term needs by putting government securities (G-secs) as collateral. Under Reverse Repo, RBI borrows money from banks by lending securities. While repo injects liquidity into the system, the Reverse repo absorbs the liquidity from the system. RBI only announces Repo Rate. The Reverse Repo Rate is linked to Repo Rate and is 100 basis points (1%) below repo rate. RBI makes decision regarding Repo Rate on the basis of prevalent market conditions and relevant factors.

201. The special drawing rights (SDR) is a kind of reserve of foreign exchange assets created by the

A) World BankB) Federal ReserveC) IMFD) ADBE) RBICorrect answer: C

202. Which of the following terms is NOT used in the field of banking and finance?

A) NPAB) CAMELSC) SWIFTD) JAXAE) BSBDACorrect answer: D

203. Euro is the currency of all the following countries except

A) Sweden

B) MaltaC) AustriaD) FinlandE) GreeceCorrect answer: A

204. The DEAF fund is associated with

A) UnicefB) Red CrossC) CRYD) World BankE) RBICorrect answer: E

Solution : The DEAF was first announced in the annual monetary policy by RBI in May, 2013, with a view to use unclaimed deposits with banks for depositor education & awareness.

The Reserve Bank of India clarified that banks will have to calculate balances in all accounts falling under the Depositor Education and Awareness Fund (DEAF) Scheme, and transfer interest payments on June 30, which must be calculated till the date of transfer of funds.

Under the scheme, the credit of any account in India with any bank that has not been operated for 10 years or any deposit or any amount remaining unclaimed for more than 10 years has to be credited to the fund within three months from the expiry of the said period of 10 years.

"The interest payable, if any, from the Fund on a claim shall accrue only from the date on which the balance in an account was transferred to the Fund till the date of payment to the customer/depositor," RBI said in a clarification on Wednesday.

The fund is to be used for the promotion of depositors interest and other purposes as specified by the RBI. However, depositors are entitled to claim their deposit, or any other unclaimed amount, from the bank or operate the account after 10 years, even if the amount has been transferred to the Fund.

The DEAF was first announced in the annual monetary policy by RBI in May, 2013, with a view to use unclaimed deposits with banks for depositor education and awareness.

205. Which of the following is a financial inclusion scheme?

A) Stand Up India

B) Swachh BharatC) Skill IndiaD) Imprint IndiaE) Other than those given as optionsCorrect answer: A

Solution : The 'Start up India Stand up India' initiative was announced by Prime Minister Narendra Modi in his address to the nation from the ramparts of Red Fort on 15th August, 2015. Thereafter, the Union Cabinet, chaired by PM Modi approved the 'Stand Up India Scheme' in January. It is expected to benefit at least 2.5 lakh borrowers. Here is all you want to know about the Stand Up India scheme:

1. The Stand Up India scheme is anchored by Department of Financial Services (DFS) to encourage greenfield enterprises by SC/ST and women entrepreneurs.

2. The Stand Up India scheme is intended to facilitate at least two such projects per bank branch, on an average one for each category of entrepreneur.

3. The expected date of reaching the target of at least 2.5 lakh approvals is 36 months from the launch of the Stand Up India scheme.

4. The Stand Up India scheme provides for refinance window through Small Industries Development Bank of India (SIDBI) with an initial amount of Rs 10,000 crore.

5. The Stand Up India scheme provides for creation of a credit guarantee mechanism through the National Credit Guarantee Trustee Company (NCGTC).

206. The domestic card payment solution RuPay is operated by the

A) RBIB) SBIC) NABARDD) SIDBIE) NPCICorrect answer: E

207. In the FY16, Indian firms have raised over `58,000 cr through the issuance of NCDs, which means

A) Non-Cashable Debentures

B) Non-Collateral DebenturesC) Non-Convertible DerivativesD) Non-Convertible DebenturesE) Other than those given as optionsCorrect answer: D

Solution : Nonconvertible debentures are unsecured bonds that cannot be converted to company equity or stock. Nonconvertible debentures usually have higher interest rates than convertible debentures. A fixed deposit is an arrangement with a bank where a depositor places money in the bank and is paid a regular fixed profit.

208. What is the tagline of Bharatiya Mahila Bank?

A) Empowering Women – Empowering IndiaB) With You All the WayC) Where Women BankD) Relationship Beyond bankingE) Together We CanCorrect answer: A

209. What is the currency of Mauritius?

A) Mauritian rupeeB) Mauritian rupiahC) Mauritian rufiyaaD) Mauritian poundE) Mauritian dollarCorrect answer: A

210. What is the full form of the term NOFHC as used in banking?

A) Non-Operative Formal Holding CompanyB) Non-Operative Fallacious Holding CompanyC) Non-Operative Family Holding CompanyD) Non-Operative Financial Holding CompanyE) None of theseCorrect answer: D

Solution :

In February 2013, RBI had issued final guidelines to apply for new banking licenses in the private sector. Under these guidelines, RBI said that the entities or groups in the private sector, entities in public sector and Non-Banking Financial Companies (NBFCs) can set up a bank, which shall be a wholly-owned Non-Operative Financial Holding Company (NOFHC). The company so formed will be registered as a NBFC. On the basis of various applications, RBI issued in principle license to only 2 applicants’ viz. Infrastructure Development Finance Company (IDFC) and microfinance lender Bandhan Financial Services Ltd to start banking services in the form of NOFHC entities. This article discusses salient features of the NOFHCs:

Objective of NOHFC

The objective of bringing into the concept of the NOFHC is to separate several financial activities carried out by the same holding company. This implies that the holding company can carry out other commercial, industrial as well as financial activities but one should not encroach upon the functions of another. Further: NOFHC will be allowed to engage itself in several other financial activities in the form of Joint Ventures, Subsidiaries or Associate Ventures after three years of its formation subject to some exceptions and with every activity subjected to the supervision of its primary regulator but RBI has the power to call for information and intervene when circumstances demand. NOFHC will have to follow a separate set of Corporate Governance Rules as well as exposure norms. The NOFHC shall be wholly owned by the Promoter / Promoter Group. The NOFHC shall hold the bank as well as all the other financial services entities of the group.

211. You cannot access which of the following services at an automated teller machine (ATM)?

A) Account InformationB) Cash DepositC) Fund transferD) Request for Cheque BookE) None of theseCorrect answer: E

212. As per the draft guidelines issued by the RBI for ‘on tap’ licensing of universal banks, the bank shall open at least what per cent of its branches in unbanked rural centres?

A) 5 per centB) 10 per centC) 25 per centD) 30 per centE) 40 per centCorrect answer: C

213. Dili is the capital city of

A) MauritiusB) SurinameC) CambodiaD) Trinidad and TobagoE) East TimorCorrect answer: E

214. The Centre has allowed 100 per cent FDI in ARCs under the automatic route. The term ARC stands for

A) Asset Recognition CompanyB) Asset Reconstruction CompanyC) Asset Restructuring CompanyD) Asset Rating CompanyE) None of theseCorrect answer: B

Solution : An Asset Reconstruction Company (ARC) is a company that is set up to do exactly what the name suggests — reconstruct or re-package assets to make them more saleable. The assets in question here are loans from banks, card companies, financial institutions etc.

215. Which bank has launched the country’s first contactless business credit card in association with Jet Airways?

A) HDFC BankB) SBIC) Axis BankD) ICICI BankE) Federal BankCorrect answer: D

216. The Reserve Bank will shortly issue banknotes of which denominations with inset letter ‘R’ in both the number panels?

A) Rs.50B) Rs.100C) Rs.500

D) Rs.1000E) Rs.10000Correct answer: D

217. Which of the following is India’s largest urban co-operative bank?

A) Saraswat Cooperative BankB) MACO BANKC) Bharati Sahakari BankD) Pravara Sahakari BankE) Surat Peoples Coop BankCorrect answer: A

218. The recently launched Pradhan Mantri Ujjwala Yojana to provide 5 crore free LPG connection to poor families is a scheme worth

A) Rs.6,000 crB) Rs.8,000 crC) Rs.10,000 crD) Rs.12,000 crE) Rs.15,000 crCorrect answer: B

Solution : Pradhan Mantri Ujjwala Yojana is an ambitious social welfare scheme of Narendra Modi Government launched on 1st May 2016 from Ballia in Uttar Pradesh. Under the PM Ujjwala Yojana, the government aims to provide LPG connections to BPL households in the country. The scheme is aimed at replacing the unclean cooking fuels mostly used in the rural India with the clean and more efficient LPG (Liquefied Petroleum Gas).

Objectives of Pradhan Mantri Ujjwala Yojana

Ujjwala Yojana is aimed at providing 5 Crore LPG connections in the name of women in BPL (Below Poverty Line) households across the country. The government has set a target of 5 Crore LPG connections to be distributed to the BPL households across the country under the scheme. Some of the objectives of the scheme are

1. Empowering women and protecting their health.

2. Reducing the serious health hazards associated with cooking based on fossil fuel.

3. Reducing the number of deaths in India due to unclean cooking fuel.

4. Preventing young children from significant number of acute respiratory illnesses caused due to indoor air pollution by burning the fossil fuel.

219. NABARD has partnered with which country for a special programme on ‘soil protection and rehabilitation for food security’?

A) JapanB) IsraelC) SpainD) FranceE) GermanyCorrect answer: E

220. The SBI cut its MCLR by 5 bps recently. In the term MCLR, the letter ‘M’ stands for

A) MinimumB) MaximumC) MarginalD) MultipleE) MaturityCorrect answer: C

Solution : MCLR stands for Marginal Cost of Funds based Lending Rate, a new system for of lending rate at which banks will now lend to new borrowers. Till 31st March 2015, used the base rate as the benchmark rate to lend.

221. The payments banks can accept demand deposits and savings bank deposits from individuals and small businesses, up to a maximum of _________ per account.

A) Rs.20,000B) Rs.25,000C) Rs.50,000D) Rs.1 lakhE) Rs.2 lakhCorrect answer: D

222. The 2005 MG series banknotes have which of the following printed on it?

A) Year of withdrawalB) Year of issuanceC) Year of printingD) Year of reprintingE) Bapu’s date of birthCorrect answer: C

223. When was the commercial paper (CP) introduced in India?

A) 1974B) 1987C) 1990D) 1992E) 1996Correct answer: C

224. The rate of interest on Senior Citizens Savings Scheme with effect from 1 Apr 2016 is

A) 7.9 per centB) 8.1 per centC) 8.3 per centD) 8.6 per centE) 8.9 per centCorrect answer: D

225. The deposit insurance and credit guarantee corporation (DICGC) does not insure which of the following deposits?

A) SavingsB) FixedC) CurrentD) RecurringE) Inter-bankCorrect answer: E

Solution :

Deposit Insurance and Credit Guarantee Corporation (DICGC) is a subsidiary of Reserve Bank of India. It was established on 15 July 1978 under Deposit Insurance and Credit Guarantee Corporation Act, 1961 for the purpose of providing insurance of deposits and guaranteeing of credit facilities. DICGC insures all bank deposits, such as saving, fixed, current, recurring deposits for up to the limit of Rs. 100,000 of each deposit in a bank.

The functions of the DICGC (deposit insurance and credit guarantee corporation)are governed by the provisions of 'The Deposit Insurance and Credit Guarantee Corporation Act, 1961' (DICGC Act) and 'The Deposit Insurance and Credit Guarantee Corporation General Regulations, 1961' framed by the Reserve Bank of India in exercise of the powers conferred by sub-section (3) of Section 50 of the said Act.

The preamble of the Deposit Insurance and Credit Guarantee Corporation Act, 1961 states that it is an Act to provide for the establishment of a Corporation for the purpose of insurance of deposits and guaranteeing of credit facilities and for other matters connected therewith or incidental thereto.

1. Organization and Functions

2. Organisational Structure

3. Management

226. An enterprises engaged in the manufacturing with investment in plant and machinery not exceeding Rs.25 lakh is called a

A) micro enterpriseB) small enterpriseC) medium enterpriseD) large enterpriseE) None of theseCorrect answer: A

227. Which of the following terms is NOT used in the field of banking/finance?

A) CRAR

B) MCLRC) BBBD) BCBSE) ELISACorrect answer: E

228. India’s ranking is ninth on the index prepared by The Economist based on crony capitalism across the world. The index is topped by

A) SingaporeB) PhilippinesC) MalaysiaD) RussiaE) GermanyCorrect answer: D

229. Which of the following banks has its headquarters situated in Mumbai?

A) State Bank of IndiaB) Allahabad BankC) Punjab National BankD) Indian Overseas BankE) UCO BankCorrect answer: A

230. The first regional office of the New Development Bank (NDB) or BRICS Bank will be opened in

A) MumbaiB) BeijingC) BrasiliaD) SochiE) JohannesburgCorrect answer: E

231. _________ operates outside the regular banking system and its financial intermediation activities are undertaken with less transparency and regulation.

A) Narrow BankingB) Para-BankingC) Unit BankingD) Universal BankingE) Shadow BankingCorrect answer: E

232. Iran wants India to pay all oil bills raised from Apr 2016 in

A) Indian rupeeB) Iranian rialC) EuroD) US dollarE) UK poundCorrect answer: C

233. Loans to individuals for educational purposes, up to what amount, are eligible for classification under priority sector lending by banks?

A) Rs 8lakhB) Rs 10 lakhC) Rs 12 lakhD) Rs 15 lakhE) Rs 20 lakhCorrect answer: B

234. The govt has set the target of how many LPG connections to be distributed to the BPL households under the Pradhan Mantri Ujjwala Yojana (PMUY)?

A) 5 lakhB) 10 lakhC) 1 crD) 5 crE) 10 crCorrect answer: D

Solution : Clean Fuel is Accessible to only limited people. Poor people use the conventional methods like using fossil fuels. The usage of such fuels causes serious health problems. So, this scheme has

been introduced to make sure that even the poorest families (BPL) have access to clean Fuel, LPG.

Features of Pradhan Mantri Ujjwala Yojana

1. 5 Crore LPG connections will be delivered to BPL families with a support of Rs. 1600

2. Connections will be issued on the name of women beneficiaries

3. For the stove and refill cost, EMI facility will also be provided

4. To identify the BPL, Below Poverty Line Families the centre will consult the state and Union Territory governments.

235. Which of the following is NOT an officially valid document for the purpose of opening an account with a bank?

A) Aadhaar CardB) NREGA CardC) Driving LicenceD) PassportE) None of theseCorrect answer: E

236. As the govt further eases rules to do away with prior approval for investments, the phase-out of which of the following may take place in future?

A) DIPPB) FIPBC) RBID) EXIM BankE) SEBICorrect answer: B

237. How many Banking Ombudsmen are there across the country at present?

A) 8B) 10C) 12

D) 15E) 18Correct answer: D

Solution : Banking Ombudsman is a quasi-judicial authority functioning under India’s Banking Ombudsman Scheme 2006, and the authority was created pursuant to a decision made by the Government of India to enable resolution of complaints of customers of banks relating to certain services rendered by the banks. The Banking Ombudsman Scheme was first introduced in India in 1995, and was revised in 2002. The current scheme became operative from 1 January 2006, and replaced and superseded the banking Ombudsman Scheme 2002. From 2002 until 2006, around 36,000 complaints have been dealt by the Banking Ombudsmen.

238. The ambitious Unnat Jyoti by Affordable LEDs for All (UJALA) scheme will be implemented across the country by

A) 2021B) 2020C) 2019D) 2018E) 2017Correct answer: C

Solution : The Union Government has launched National LED programme – Unnat Jyoti by Affordable LEDs for All (UJALA). It was launched by Union Minister for State (IC) for Power, Coal and Renewable Energy Piyush Goyal in Bhopal, Madhya Pradesh.

Key facts

1. The UJALA scheme is being implemented by Energy Efficiency Services Limited (EESL), a joint venture of PSUs under the Union Ministry of Power.

2. It is LED based Domestic Efficient Lighting Programme (DELP). Under it, 3 crore LED Bulbs will be distributed in Madhya Pradesh in the next 6 months.

3. Under it, people of Madhya Pradesh will get subsidised 9W energy efficient LED bulbs by paying just 85 rupees per LED bulb.

4. The scheme will help reduce electricity bills of consumers, contribute to the energy security of India and also help in environment protection.

239. NABARD has partnered with which country for a special programme on ‘soil protection and rehabilitation for food security’?

A) JapanB) IsraelC) SpainD) FranceE) GermanyCorrect answer: E

240. Which of the following is one of the eight core sector industries?

A) AutomobilesB) TextilesC) ElectronicsD) Food processingE) ElectricityCorrect answer: E

241. Who among the following cannot open a basic savings bank deposit account (BSBDA) with a bank?

A) A govt employeeB) A daily wagerC) A pensionerD) A studentE) None of theseCorrect answer: E

Solution : RBI in 2012 came out with fresh guidelines and asked banks to offer a ‘Basic Savings Bank Deposit Account’ which will offer following minimum common facilities to all their customers. These guidelines inter-alia includes:-

1. This account shall not have the requirement of any minimum balance.

2. The services available in the account will include deposit and withdrawal of cash at bank branch as well as ATMs; receipt/credit of money through electronic payment channels or by means of deposit/collection of cheques drawn by Central/State Government agencies and departments;

3. While there will be no limit on the number of deposits that can be made in a month, account holders will be allowed a maximum of four withdrawals in a month, including ATM withdrawals; and

4. Facility of ATM card or ATM-cum-Debit Card;

242. Who among the following is NOT a deputy governor of the RBI as of now?

A) Harun R KhanB) Urjit R PatelC) R GandhiD) SS MundraE) KC ChakrabartyCorrect answer: E

243. Which state govt announced 10% reservation for the economically backward among upper castes recently?

A) MaharashtraB) Uttar PradeshC) TelanganaD) GujaratE) RajasthanCorrect answer: D

244. All the following are directly related to the RBI except

A) OMOB) CRRC) LAFD) SENSEX

E) OmbudsmanCorrect answer: D

245. The national agency responsible for promotion of foreign investment in India is

A) DIPPB) FIPBC) CCEAD) FEMAE) SIDBICorrect answer: B

246. The annual meeting of the Asian Development Bank (ADB) was held recently in

A) New DelhiB) TokyoC) ManilaD) FrankfurtE) BangkokCorrect answer: D

247. The currency of New Zealand is

A) US dollarB) RielC) KroneD) New Zealand dollarE) ShekelCorrect answer: D

248. A mobile-only bank named ‘digibank’ was launched recently in India by

A) Citi BankB) HSBCC) ICICI BankD) DBS BankE) HDFC BankCorrect answer: D

249. The tagline “The name you can BANK upon” is associated with

A) Canara BankB) Bank of BarodaC) PNBD) SBIE) Bank of IndiaCorrect answer: C

250. What is the expanded form of FPI as used in banking and finance?

A) Forward Portfolio InvestorB) Foreign Preferential InvestorC) Financial Portfolio Investor

D) Foreign Portfolio InvestorE) None of theseCorrect answer: D

Solution : A portfolio investment is a grouping of assets such as stocks, bonds, and cash equivalents. Portfolio investments are held directly by an investor or managed by financial professionals. In economics, foreign portfolio investment is the entry of funds into a country where foreigners deposit money in a country's bank or make purchases in the country’s stock and bond markets, sometimes for speculation.

Portfolio investments typically involve transactions in securities that are highly liquid, i.e. they can be bought and sold very quickly. A portfolio investment is an investment made by an investor who is not involved in the management of a company. This is in contrast to direct investment, which allows an investor to exercise a certain degree of managerial control over a company. Equity investments where the owner holds less than 10% of a company's shares are classified as portfolio investment. These transactions are also referred to as "portfolio flows" and are recorded in the financial account of a country's balance of payments. According to the Institute of International Finance, portfolio flows arise through the transfer of ownership of securities from one country to another.

251. Which of the following terms is used in the field of banking and finance?

A) DialysisB) Baud rateC) MIBORD) DSLRE) LumenCorrect answer: C

252. The regulation and supervision of the functions of Co-operative banks and RRBs rests with the

A) NABARDB) NHBC) SIDBID) SBIE) DIPPCorrect answer: A

253. Rand is the currency of which of the following countries?

A) BrazilB) MalaysiaC) PhilippinesD) South AfricaE) VietnamCorrect answer: D

254. Name the recently added 189th member of the IMF and the World Bank.

A) NauruB) South SudanC) HonshuD) LuzonE) None of theseCorrect answer: A

255. indian bank for its first tie-up with any bank in India to explore opportunities?

A) HDFC BankB) ICICI BankC) SBID) PNBE) UCO BankCorrect answer: B

256. Identify the one which is NOT a monetary tool of the RBI.

A) Call moneyB) Repo rateC) Reverse repo rateD) Cash reserve ratioE) None of theseCorrect answer: A

257. A current account is always a _______ to bank.

A) time depositB) flexi depositC) recurring depositD) demand depositE) None of theseCorrect answer: D

Solution : Current account is one of the two component accounts of the balance of payments of a nation. It records the trade of goods and services of an economy with other countries of the world.

Current account includes three components - net exchange i.e. exports minus imports of goods, net exchange of services and net transfers to and from the country. The balance in this account before accounting for the transfer component is generally referred to as the balance of trade. In India, current account is reported by the Reserve Bank of India.

258. The initial minimum paid-up capital required to open a new universal bank in India is

A) Rs.100 crB) Rs.200 crC) Rs. 500 crD) Rs. 1000 crE) Rs. 5000 crCorrect answer: C

259. Under the Kishor category, Mudra Bank provides loans from `50,000 to

A) Rs. 1 lakhB) Rs. 2 lakhC) Rs. 5 lakhD) Rs. 10 lakhE) Rs. 20 lakhCorrect answer: C

260. In case of a cheque, a bank is always a

A) payerB) payeeC) drawerD) draweeE) None of theseCorrect answer: D

261. The Allahabad Bank is headquartered at

A) LucknowB) New DelhiC) MumbaiD) KolkataE) AllahabadCorrect answer: E

262. The Indian Financial System Code (IFSC) contains _________ characters.

A) seven

B) eightC) nineD) tenE) elevenCorrect answer: E

263. The bank granted in-principle approval by SEBI recently for it to act as custodian of securities (CoS) is

A) Federal BankB) Bandhan Bank C) IDFC BankD) RBL BankE) YES BankCorrect answer: E

264. Which of the following terms is NOT used in the field of banking and finance?

A) SWIFTB) CAMELSC) IMPSD) CHAPSE) None of theseCorrect answer: E

265. When an asset or loan remains non-performing for 12 months or less and the underlying guarantee is not enough to pay back the loan, it is classified as a

A) standard assetB) substandard assetC) doubtful assetD) loss assetE) None of theseCorrect answer: B

266. India is all set to sign Logistics Exchange Memorandum of Agreement or LEMOA with which of the following countries?

A) ChinaB) IsraelC) IranD) JapanE) USCorrect answer: E

267. As per Moody’s Investors Service, the govt will have to infuse what amount into 11 PSU banks by 2020 to bolster their balance sheets and make good the losses suffered by them?

A) `25,000 crB) `45,000 crC) `85,000 crD) `1.2 lakh crE) `2.5 lakh crCorrect answer: D

268. Which of the following states topped the MGNREGA Implementation Ranking 2015-16?

A) Andhra PradeshB) Sikkim C) RajasthanD) Madhya PradeshE) TripuraCorrect answer: E

269. Which of the following is NOT correct with respect to the second bi-monthly monetary policy statement, 2016-17, issued by the RBI on 7 Jun?

A) Repo rate – 6.50%B) Reverse repo rate – 6%C) Cash Reserve Ratio – 4.25%D) Growth forecast for the current fiscal – 7.6%E) Inflation target for Jan 2017 – 5%Correct answer: C

270. Which of the following committees has been constituted by the govt to boost cashless transactions in the country?

A) Rajeev Kher CommitteeB) Ratan Watal CommitteeC) Ashok Lavasa CommitteeD) Neeraj Gupta CommitteeE) Bibek Debroy CommitteeCorrect answer: D

271. India is anticipated to grow at what per cent in 2016-17 according to the World Bank?

A) 6.7 per centB) 6.9 per centC) 7.1 per centD) 7.3 per centE) 7.6 per centCorrect answer: E

272. Which of the following practices of banks is termed as cross-selling?(A) Selling an insurance policy to a depositor(B) Selling to an existing savings account holder a credit car(C) Selling to an existing credit card customer a mortgage

A) Only (A)B) Only (B)C) Only (A) and (B)D) Only (B) and (C)E) All (A), (B) and (C)Correct answer: E

273. Which Indian bank has launched India’s first internationally-listed certified green bond to finance climate change solutions around the world at London Stock Exchange (LSE)?

A) HDFC BankB) ICICI BankC) Axis BankD) Federal BankE) Yes BankCorrect answer: C

274. The govt has constituted a selection committee to shortlist the candidates for the post of the RBI governor. The Committee is headed by

A) PK SinhaB) Rajiv MehrishiC) Ajit DovalD) Nripendra MisraE) Ajit SethCorrect answer: A

275. Under the new norms, all the users of P-Notes would have to follow Indian KYC and AML Regulations. Here, what is the full form of the term AMA?

A) Aggregate Market LiabilityB) Advance Money LiabilityC) Asset Making LimitationD) Anti-Money LaunderingE) None of theseCorrect answer: D

Solution : Anti-money laundering ("Financial Crime") is the term used in the financial industry to describe the controls that financial institutions and other regulated entities undertake to prevent, detect, and report money laundering activities. Money laundering is the process of making illegally-gained proceeds appear legal, and typically involves three steps: placement, layering and integration. In the "placement" stage, the ill-gotten proceeds are entered into the financial system, sometimes in cash deposits that are structured to avoid bank reporting thresholds. In the "layering" step, the proceeds are moved throughout the financial system in complicated transactions to obscure the original source of the funds. The final step involves the "integration" and assimilation of the laundered money back into the legitimate financial system, usually through the purchase of goods or services. At this stage, it is extremely difficult to distinguish the legal and illegal funds. Financial institutions are governed by different sets of Financial Crime laws and regulations that are specific to the country in which they are operating. In the US, the two primary sets of rules governing Financial Crime are the Bank Secrecy Act (BSA) and the PATRIOT Act. Financial institutions must employ large numbers of employees with varied skill-sets in order to comply with these laws.

276. NK Chari has been appointed the new Managing Director of which of the following associate banks of SBI?

A) State Bank of Travancore

B) State Bank of PatialaC) State Bank of HyderabadD) State Bank of MysoreE) State Bank of Bikaner & JaipurCorrect answer: D

277. According to the Federation of Indian Chambers of Commerce and Industry’s Economic Outlook Survey, India’s economy will grow at what per cent in 2016-17?

A) 7.1 per centB) 7.3 per centC) 7.6 per centD) 7.7 per centE) 9.6 per centCorrect answer: D

278. Which of the following leading microfinance firms has renamed itself as Bharat Financial Inclusion Ltd?

A) Bandhan Financial ServicesB) Asirvad MicrofinanceC) Annapurna MicrofinanceD) SKS MicrofinanceE) Arohan Financial ServicesCorrect answer: D

279. The RBI introduced the concept of SDR to help banks recover their loans by taking control of the distressed listed companies. Here, the term SDR stands for

A) Special Drawing RightsB) Strategic Drawing RightsC) Special Debt RestructuringD) Strategic Debt RestructuringE) None of theseCorrect answer: D

280. Which of the following is the new benchmark to which the pricing of loans from the banks in India is linked as of now?

A) BPLRB) MCLRC) MIBORD) LIBORE) None of theseCorrect answer: B

281. In the belowmentioned conditions, which of the given options will be the preferred instrument for investment? (A) It is issued from registered foreign institutional investors (FII) to overseas investors. (B) It is preferred by the overseas investors who wish to invest in the Indian stock markets. (C) FIIs can issue it to funds/companies whose identity is not known to the Indian authorities.

A) Commercial PaperB) Gilt FundC) Participatory NoteD) Exchange-Traded FundE) There is no such instrumentCorrect answer: C