Banking & Financial Awareness (RBI, Rates, Digital Banking) — Practice

Question 1

Which of the following is NOT issued by the Reserve Bank of India?
(a) ₹100 note  (b) ₹500 note  (c) ₹1 note  (d) ₹200 note

Accepted Answer

The ₹1 note (and all coins) is issued by the Ministry of Finance and bears the Finance Secretary's signature; all other notes are issued by the RBI.

Answer: (c) ₹1 note.

Question 2

Which reserve requirement is held by the bank itself in cash, gold or approved securities and has a statutory maximum of 40%?
(a) CRR  (b) SLR  (c) MSF  (d) Repo

Accepted Answer

SLR (Statutory Liquidity Ratio) is kept by the bank itself in liquid assets, max 40%. CRR is cash held WITH the RBI and earns no interest.

Answer: (b) SLR.

Question 3

The Standing Deposit Facility (SDF), introduced in April 2022, forms which part of the LAF corridor?
(a) The ceiling  (b) The floor  (c) The mid-point equal to repo  (d) It replaced the MSF

Accepted Answer

The SDF lets banks park surplus funds with the RBI without collateral and sits below the repo — it is the FLOOR of the corridor (MSF is the ceiling).

Answer: (b) The floor.

Question 4

Which payment system is operated directly by the RBI (not NPCI)?
(a) UPI  (b) IMPS  (c) RTGS  (d) RuPay

Accepted Answer

RTGS (and NEFT) are operated by the RBI. UPI, IMPS and RuPay are run by NPCI.

Answer: (c) RTGS.

Question 5

The insurance sector in India is regulated by which body, headquartered in Hyderabad?
(a) SEBI  (b) PFRDA  (c) IRDAI  (d) NABARD

Accepted Answer

IRDAI (Insurance Regulatory and Development Authority of India), HQ Hyderabad. SEBI = securities (Mumbai), PFRDA = pensions (Delhi).

Answer: (c) IRDAI.

Question 6

A loan is classified as a Non-Performing Asset when instalments/interest are overdue for more than:
(a) 30 days  (b) 60 days  (c) 90 days  (d) 180 days

Accepted Answer

A loan turns NPA after 90 days of overdue interest/principal, then classified Sub-standard → Doubtful → Loss. Recovery via SARFAESI 2002, DRT and IBC 2016.

Answer: (c) 90 days.

Question 7

What is the maximum end-of-day balance a Payments Bank can hold per individual customer, and can it lend?
(a) ₹1 lakh, can lend  (b) ₹2 lakh, cannot lend  (c) ₹5 lakh, can lend  (d) No limit, cannot lend

Accepted Answer

Payments Banks can hold up to ₹2 lakh per customer and CANNOT lend or issue credit cards. (The limit was raised from ₹1 lakh to ₹2 lakh in 2021.)

Answer: (b) ₹2 lakh, cannot lend.

Question 8

Up to what amount are bank deposits insured per depositor per bank by the DICGC?
(a) ₹1 lakh  (b) ₹2 lakh  (c) ₹5 lakh  (d) ₹10 lakh

Accepted Answer

The DICGC (an RBI subsidiary) insures deposits up to ₹5 lakh per depositor per bank.

Answer: (c) ₹5 lakh.

Practice — Banking & Financial Awareness (RBI, Rates, Digital Banking)

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