Q 1: Licencing of banks in India is an important function of RBI.

This forms part of which of the

following functions of the bank? 1 Mark

a) Regulatory Function
b) Monetary Function
c) Banker to Bank Foundation
d) Banker to Govt Function

Q 2: The Reserve Bank requires banks to maintain a certain amount of cash in reserve as a
percentage of their deposit. This is known as 1 Mark

a) Statutory Liquidity Ratio

b) Cash Reserve Ratio
c) Repo Rate
d) Reverse Repo Rate

Q 3: The rate at which RBI borrows money from the commercial banks is known as__ 1 Mark

a) Statutory Liquidity Ratio

b) Cash Reserve Ratio
c) Repo Rate
d) Reverse Repo Rate

Q 4: The rate at which the central bank of a country (Reserve Bank of India in case of India) lends
money to commercial banks in the event of any shortfall of funds is known as ____ 1 Mark

a) Statutory Liquidity Ratio

b) Cash Reserve Ratio
c) Repo Rate
d) Reverse Repo Rate

Q 5: Under which policy, RBI controls inflation and maintain price stability in market.

a) Monetary Policy
b) Fiscal Policy
c) Tax Policy
d) Regulatory Policy

Q 6: Which of the following is not a type of bank in India? 1 Mark

a) Nationalised Bank
b) Regional Rural Bank
c) Cooperative Bank
d) LIC of India
e) Private sector bank

Q 7: Lender of last resort in India is 1 Marks

a) Any government organisation

 b) Any nationalised bank
c) SEBI
d) RBI
e) Central or State Government

Q 8: When a customer takes a loan from a bank, he is the 1 Mark

a) borrower
b) lender
c) both
d) neither

Q 9: Who among the following is the issuing authority of currency coins and One Rupee Note in
India? 1 Mark

a) Reserve Bank of India

b) Government of India
c) President of India
d) Parliament of India

Q 10: The relationship between the depositor and the bank is one of... 1 Mark

a) Debtor and creditor

b) Creditor and Debtor
c) Beneficiary and Trustee
d) Principal and Agent

Q 11: When a customer deposits certain valuables with bank for their safe custody, which kind of
relationship is established between customer and bank? 1 Mark

a) Creditor and Debtor

b) Beneficiary and Trustee
c) Bailor and Bailee
d) Principal and Agent

Q 12: Deposits made with the bank will be barred for recovery by Law of Limitation… 1 Mark

a) 3 years after making the deposit

b) 5 years after making the deposit
c) 7 years after making the deposit
d) 3 years after making a demand on the bank

Q 13: Which among the following is the advantage of retail banking? 1 Mark

a) Funding sources
b) Diversification of Risk
 c) Increased Profitability
d) All of them

Q 14: Which one of the following is an important characteristic of retail banking? 1 Mark

a) Large number of large value relationship

b) Small number of large value relationship
c) Small number of small value relationship
d) Large number of small value relationship

Q 15: Customer interface is generally the responsibility of which division of retail bank 1 Mark

a) Back office
b) Middle office
c) Branch manager office
d) Front office

Q 16: Retail banking helps a bank in achieving which of the following objectives 1 Mark

a) Lower its cost of funds and increase its risk

b) Increase its cost of funds and lower its risk
c) Increase its cost of funds and increase its risk
d) Lower its cost of funds and lower its risk

Q 17: Which of the following is the first bank to set up an ATM in India? 1 Mark

a) HSBC Bank
b) HDFC Bank
c) ICICI Bank
d) State Bank of India

Q 18: What do you mean by ATM? 1 Mark

a) Automatic Teller Machine

b) Automated Teller Machine
c) Any Time Money
d) All Time Money

Q 19: From a cost perspective which of the following channel is the cheapest for a bank? 1 Mark

a) Internet
b) Telephone
c) Branch
d) ATM

Q 20: Savings account is which type of deposit? 1 Mark

a) Demand Deposit
b) Time Deposit
c) Recurring Deposit
 d) Any Time Deposit

Q 21: Suresh has invested Rs 1 Lakh as a Fixed Deposit in ABC Bank for 3 years. What kind of deposit
it is? 1 Mark

a) Demand Deposit
b) Time Deposit
c) Recurring Deposit
d) Any Time Deposit

Q 22: Rahul is NRI Individual and wishes to open Bank Account in India. He wishes to maintain the
account in Dollar instead of Rupees. As a Bank Officer, which of the following account do you
suggest? 1 Mark

a) NRE Account
b) NRO Account
c) NRI Account
d) PIO Account

Q 23: Which of the following account is also known as Checking Account in some Indian Bank?

1 Mark

a) Domestic Savings Account

b) Domestic Current Account
c) FCNR Account
d) SWIFT Account

Q 24: ABC Private Limited is Indian Private Limited Company and wishes to open a bank account for
their business transaction. Which type of account do you suggest as a bank officer? 1 Mark

a) Domestic Savings Account

b) Domestic Current Account
c) FCNR Account
d) SWIFT Account

Q 25: What is the minimum tenor of Fixed Deposit? 1 Mark

a) 7 Days
b) 14 Days
c) 21 Days
d) 28 Days
Q 26: What is the tenor of fixed deposit with Tax Benefit under Section 80C? 1 Mark

1 Year

3 Years

5 Years

7 Years

Q 27: What is maximum limit of tax exemption under Section 80C? (Upto what amount of
Investment, As per Section 80C, No Tax is applicable) 1 Mark

Rs 50000

Rs 75000

Rs 100000

Rs 150000

Q 28: A customer is planning to slowly build up his savings for buying a new car in a few years. Which
of the following accounts is best suited for this purpose? 1 Mark

Savings Bank Account

Current Account

Multiple Fixed Deposits

Recurring Deposits

Q 29: Which of the following Non Resident account is maintained in Indian Rupees? 1 Mark

NRI Account

NRO Account

NRE Account

NRX Account
Q 30: Under Deposit Insurance and Credit Guarantee Corporation, How much amount of deposit
(including principal and interest) is insured? 1 Mark

Rs 50000

Rs 75000

Rs 100000

Rs 150000

Q 31: RBI Stipulates a maximum loan amount in accounts where a FCRN deposit is given as security.
What is this amount? 1 Mark

Rs 100 Lakh

Rs 20 Lakh

Rs 10 Lakh

No Limits

Q 32: FCRN Deposits are accepted by Banks for a maximum tenor of 1 Mark

3 Years

5 Years

7 Years

10 Years

Q 33: A person wanting to protect his family’s valuable will approach with of the following
institutions? 1 Mark

Life Insurance Company

General Insurance Company

Mutual Fund Company

Brokerage Company

Q 34: Dealing in third party products help a bank in which of the following? 1 Mark
 a) Generate interest income
b) Generate capital gains
c) Increase Capital
d) Generate Fee Based Income

Q 35: In a Mutual Fund, the investment decisions are made by 1 Mark

a) The Investor
b) The CEO
c) The Fund Manager
d) The Risk Manager

Q 36: Which of the following would be an unacceptable address proof? 1 Mark

a) Passport
b) Voter’s card
c) Utility Bills
d) Visiting card

Q 37: Which of the following would be an unacceptable identity proof? 1 Mark

a) PAN Card
b) Voter’s Card
c) Passport
d) Electricity Bills

Q 38: A loan that is backed by an asset as collateral is known as 1 Mark

a) Secured Loan
b) Unsecured Loan
c) Open Ended Loan
d) Close Ended Loan

Q 39: A credit card is a typical example of 1 Mark

a) Secured, Instalment Loan

b) Unsecured, Instalment Loan
c) Secured Revolving Loan
d) Unsecured Revolving Loan

Q 40: In a reverse mortgage transaction, the primary source of loan repayment is 1 Mark
 a) Sale proceed of the property
b) EMI payments made by the borrower
c) Lump sum payment received from legal heirs of the borrowers
d) Payment made by the government

Q 41: Credit card holder has a direct contractual relationship with which of the following entities.

1 Mark

a) Merchant Establishment
b) Card Association
c) Acquiring Bank
d) Issuing Bank

Q 42: On which of the following loans are borrowers eligible to enjoy income tax benefits?

1 Mark

a) Home Loan and Personal loan

b) Home loan and education loan
c) Personal loan and education loan
d) Personal loans and auto loans

Q 43: A No Frill account is one in which…. 1 Mark

a) No Interest is paid on credit balances

b) No Overdraft is permitted
c) No Free Remittances can be made
d) No Requirement of Minimum Balance

Q 44: An example of revolving credit is 1 Marks

a) ATM card
b) Credit card
c) Home loan
d) Vehicle loan

Q 45: Pradhan Mantri Aavas Yojna has been started to promote which of the following sector?

1 Mark
 a) Automobile Sector
b) Housing Sector
c) IT Sector
d) None of them

Q 46: Floating rate of interest means 1 Marks

a) interest rate is fixed at the time of taking the loan

b) Interest rate changes as per changes in market
c) Interest rate differs for different customers
d) Interest rate changes on a day to day basis

Q 47: Which of the following is NOT an electronic system of payment? 1 Mark

a) Internet payment
b) Mobile payment
c) RTGS
d) Demand draft payment

Q 48: Which is not a purpose of financial inclusion? 1 Mark

a) Encourage savings
b) Purchasing luxury items for personal use
c) Investing in small ventures
d) Availing welfare subsidies

Q 49: Microfinance sector caters to which of the following segment? 1 Mark

a) Government Officials
b) Poorer and Weaker section
c) Wealthy and Rich People
d) Minors

Q 50: Who can be a customer of a bank? 1 Mark

a) Illiterate person
b) Trust
c) Partnership Firm
d) All of the above
Q 51: Equated monthly instalments (EMI) are fixed for 1 Marks

a) Gold loans
b) Credit card usage amount
c) Home loans
d) Overdrafts

Q 52: CBS means 1 Marks

a) Core Banking System

b) Complete Banking System
c) Company Banking System
d) Compliance Banking System

Q 53: Thanks to which of the following system, cheque clearing become faster than ever before.

1 Mark

a) Core Banking System

b) Complete Banking System
c) Company Banking System
d) Compliance Banking System

Q 54: Amtrutam Card is an example of 1 Mark

a) Microfinance
b) Micro Insurance
c) Both
d) None of them

Q 55: Which of the statement is correct for Microfinance 1 Mark

a) Loans are given to poor people for their justifiable end use.
b) Loans are without any security collateral.
c) The loan amount is smaller than other loan types
d) All of them

Q 56: NABARD and SIDBI are a part of micro finance institutions framework in India. 1 Mark
 a) TRUE
b) FALSE

Q 57: Interest in most of the loans are floating rate in nature 1 Mark

a) TRUE
b) FALSE

Q 58: KYC norms are not necessary for the customer wishes to open Current Account: 1 Mark

a) TRUE
b) FALSE

Q 59: SEBI and FEMA regulates NRI Deposit Accounts : 1 Mark

a) TRUE
b) FALSE

Q 60: When a customer purchases goods at a shop and is permitted to use either debit card or credit
card it is called a Point of Sale terminal. 1 Mark

a) TRUE
b) FALSE

Q 61: When someone uses Credit Card or Debit Card, Transaction is authorized through OTP. What
do you mean by OTP 1 Mark?

a) One Time Password

b) One Time Protocol
c) One Time Payment
d) One Time Passcode

Q 62: Which of the following paper based transaction cannot be dishonoured (Cannot be bounced)?

1 Mark

a) At Par Cheque
b) MICR Cheque
c) Demand Draft
d) Demand Note

Q 63: Banks can pay utility bills such as Gas Bills or Electricity Bills on behalf of customer.
1 Mark

a) TRUE
b) FALSE

Q 64: It is not necessary for the bank to know customers who are visiting bank for small transactions.

1 Mark

a) TRUE
b) FALSE

Q 65: Which of the following things is a part of Financial Inclusion? 1 Mark

a) Jan Dhan Account

b) MUDRA Yojana
c) Atal Pension Yojna
d) All of them

Q 66: Reserve Bank of India Formulates Monetary Policy in India. 1 Mark

a) TRUE
b) FALSE

Q 67: Designing Tax Rates in India is a part of Fiscal Policy in India. 1 Mark

a) TRUE
b) FALSE

Q 68: Access of Which of the following products by all Indians is the prime aim of financial inclusion
project? 1 Mark

a) Insurance
b) Deposits
c) Funding
d) All of them

Q 69: Mayur wishes to transfer the fund to his sister at 11PM. Which of the following form of
payment transfer he can use? 1 Mark

a) NEFT
b) IMPS
c) Any of them
 d) None of them

Q 70: Which of the following financial services are covered under Section 80C? 1 Mark

a) Life Insurance
b) 5 Year Fixed Deposit
c) Home Loan
d) All of them

Q 71: Banks are the bridge between people looking out of investment opportunities and people
looking for funding sources. 1 Mark

a) TRUE
b) FALSE

Q 72: In which year, Reserve Bank of India started its operations in India?

1930

1932

1935

1948

Q 73: Bank rate is the rate at which Commercial banks lends money to RBI

TRUE

FALSE

Q 74: GDP is increased if RBI reduces Repo Rate

TRUE

FALSE

Q 75: RBI administers FEMA (Foreign Exchange Management Act) Rules in India.

TRUE

FALSE

Answer any 5 out of 7

1. Repo rate helps determine the range of the short term money market rates. Please explain
this statement.
2. Explain key function of RBI
3. Explain Debtor – Creditor relationship between Bank and Customer.
4. Explain the difference between savings account and current account and explain their key
features.
5. What is difference between repatriation and non-repatriation account?
6. Explain KYC (Know your customer) and AML (Anti Money Laundering) compliances in
Banking Sector.
7. Explain key features of Credit Cards