Banking Awareness Quiz For RBI Grade B: Part 30

1. Which private sector bank recently allowed children above 10 years to open savings bank accounts after SBI is:
a) PNB
b) HDFC
c) ICICI
d) HDBI
e) None of these

2.The approach of ‘Micro-Credit’ or ‘Banking with the poor’ is comparatively a new concept in the field of rural credit. This approach has been tried very successfully in which of the following countries?
(a) Bangladesh 
(b) India 
(c) China
(d) Japan 
(e) None of these

3. The regulator of Micro Finance in India is:
(a) Finance Ministry 
(b) Reserve Bank of India 
(c) State Bank of India
(d) SEBI 
(e) None of the above

4. Truncation of cheques means:
(a) The cheques in the paper form will be retained by the collecting banker and he will submit
(b) Entire clearing operations would be done only through computers
(c) Cheques will be scanned and the electronic image, instead of physical cheque, will be transmitted in the clearing cycle
(d) Debiting the drawer’s account through internet banking
(e) None of the above

5. Which of the following is a primary function of a bank?
(a) Collection and payment of cheques, rent, interest, etc, on behalf of their customers
(b) Buying, selling and keeping in safe custody, the securities on behalf of their advice
(c) Acting as trustees and executors of the property of their customers on their advice
(d) Remitting money from one place to the other through bank drafts or mail or telegraphic transfer
(e) Accepting deposits

6. Which of the following is/are the function(s) of an Exchange Bank?
(i) Remitting money from one country to another country
(ii) Discounting of foreign bills.
(iii) Buying and selling gold and silver.
(iv) Helping Import and Export Trade.

Select the correct answer.
(a) I and II 
(b) II and III 
(c) II and IV
(d) I, II and III 
(e) All I, II, III and IV

7. Which of the following correctly describes what sub-prime lending is?
A. Lending to the people who cannot return the loans.
B. Lending to the people who are high value customers of the banks.
C. Lending to those who are not a regular customer of a bank.
(a) Only A 
(b) Only B 
(c) Only C
(d) All, A, B and C 
(e) A and C

8. Which bank has introduced a wireless appliance that uses SMS to authorized credit and transactions?
(a).UTI Bank
(b).CITI Bank
(c).ABN Amro
(d).ICICI Bank
(e).None of the above
9. Which of the following is a measure taken by Reserve Bank of India to control inflation in our country?
(a) Increase in CRR
(b) Increase in SLR
(c) Contraction of supply of currency
(d) Raising of Repo/ Reserve Repo Rate
(e) Decrease the SLR

10. What do you understand by the term ‘Mortgage’?
(a) Sale of moveable security in the event of default by the borrower
(b) Registration of charge with the Registrar of Companies
(c) Making the security of immovable property available as a cover for a home loan by the borrower
(d) Registration of charge with the Regional Transport Authority
(e) Returning of the security to borrower by the bank of receipt of full payment

11. Which of the following is not the name of Banking Organisation?
(a) HDFC 
(b) IDBI 
(c) YES
(d) SEBI 
(e) ICICI

12. Which of the following is NOT a banking/finance related term
(a) Credit wrap 
(b) EMI 
(c) Held to Maturity
(d) Exposure limit 
(e) Diffusion

13. Which of the following was the reasons owing which base rate was introduced?
(i) BPLR, system fell short of RBIs objective bringing transparency in lending rates
(ii) Under BPLR system it was difficult for RBI to access transmission of policy rates.
(iii) BPLR system was not beneficial to the customers

(a) Only (i) 
(b) Only (ii) 
(c) Only (i) & (ii)
(d) Only (ii)& (iii) 
(3) All, (i) & (ii) & (iii)

14. The Reserve Bank of India has divested its stake in State Bank of India to
(a) IDBI Bank 
(b) LIC 
(c) ICICI Bank
(d) Government of India 
(e) None of the above

15. In which year India adopted partial convertibility of rupee?
(a) 1991 
(b) 1992 
(c) 1993
(d) 1994 
(e) 1952

16. What is financial inclusion?
(a) To provide a permanent employment to the unemloyed
(b) To provide a 100 days job to all those who are in need of a job
(c) To provide banking services to all those living in remote areas
(d) To ensure that all financial transactions amounting Rs. 5,000/- and above are done through banks.
(e) None of the above

17. NABARD is a:
(a) Board 
(b) Bureau 
(c) Bank
(d) Department 
(e) none of the above

18. Which of the following is not the part of the Scheduled Banking structure in India?
(a) Money Lenders 
(b) Public Sector Banks 
(c) Private Sector Banks
(d) Regional rural banks 
(e) State Cooperative banks
19. Consider the following
1. international bank for reconstruction and development (IBRD)
2. international development association (IDA)
3. International finance corporation (IFC)
4. Multiateral investment guarntee agency (MIGA)
5. International center for settlement of investment disputes (ICSID) which among the above constitute the world bank group?

(a) I only 
(b) 1 and 2 
(c) 1, 2 and 3
(d) 1, 2, 3 and 4 
(e) 1, 2, 3, 4 and 5
20. The first Bank established in India was:
(a) Bank of India
(b) Bank of Hindustan
(c) General Bank of India
(d) None of The Above

Answers

1. Ans: c. 

ICICI Bank offers "CICI Bank Young Stars Account" for children in the age
group of one day - 18 years. As per rules, it is essential for the parent/guardian to
also hold an account with the bank. However, it authorises only the guardian /
parent to open and operate the account at all times.

2. Ans: a. 

Bangladesh
Microfinance is a much broader concept than microcredit and refers to loans, savings, insurance, money transfers, and other financial products targeted at poor and low-income people.

3. Ans: d. 

SEBI
Microfinance Institutions (MFIs) are important for credit support in unbanked & rural areas. They are envisaged to play a big role in furthering financial inclusion.

4. Ans: b. 

Entire clearing operation would be done only through computer
Cheque truncation is the conversion of a physical cheque into a substitute electronic form for transmission to the paying bank. Cheque truncation reduces or eliminates the physical movement of cheques and reduces the time and cost of processing the cheque clearance system. Cheque truncation also offers the potential reduction in settlement periods with the electronic processing of the cheque payment system.

5. Ans: a. 

Collection and payment of cheques, rent, interest, etc, on behalf of their customers
They accept deposits in several forms according to requirements of different sections of the society.

6. Ans: b. 

II and III
Most of the time the commercial bank is the only one who exercises exchange function that dont have those rural banks,cooperative banks and etc.Commercial bank also is one who is qualify for applying for universal bank because it has alot of function aside from exchange function but they have also loan discount function ,collection,fiduciary and trust function.

7. Ans: a. 

Lending to the people who cannot return the loans
In finance, subprime lending (also referred to as near-prime, subpar, non-prime, and second-chance lending) means making loans to people who may have difficulty maintaining the repayment schedule, sometimes reflecting setbacks, such as unemployment, divorce, medical emergencies, etc.

8. Ans: c. 

ABN Amro
Mobile payment (also referred to as mobile money, mobile money transfer, and mobile wallet) generally refer to payment services operated under financial regulation and performed from or via a mobile device. Instead of paying with cash, cheque (or check), or credit cards, a consumer can use a mobile phone to pay for a wide range of services and digital or hard goods. Although the concept of using non-coin-based currency systems has a long history, it is only recently that the technology to support such systems has become widely available.

9. Ans: d. 

Raising of Repo/ Reserve Repo Rate
The various methods are usually grouped under three heads: monetary measures, fiscal measures and other measures.

10. Ans: c. 

Making the security of immovable property available as a cover for a home loan by the borrower
Lends money at interest in exchange for taking title of the debtor's property, with the condition that the conveyance of title becomes void upon the payment of the debt.

11. Ans: d. SEBI

National and international organisations and trade groups representing banking in respective countries

12. Ans: e. 

Diffusion

13. Ans: c. 

Only (A) and (B)
While cost of funds of banks have come down owing to lower policy rates, they could not match their lending rates with reduced policy rates as their average cost of borrowing still remained high because of older fixed deposits.

14. Ans: d. 

Government of India

15. Ans: b. 

1992
When Partial convertibility of Rupee on current account was introduced 1992, government had announced its intention to introduce the full convertibility on the current account in 3 to 5 years. The full convertibility means no RBI dictated rates and there is a unified market determined exchange rate regime. Encouraged with the success of the LERMS, the government introduced the full convertibility of Rupee in Trade account(means only merchandise trade no service trade)from March 1993 onwards. With this the dual exchange rate system got automatically abolished and LERMS was now based upon the open market exchange. The full convertibility of Rupee was followed by stability in the Rupee Rate in the next many months coming up.

16. Ans: c. 

To provide banking services to all those living in remote areas
Financial inclusion may be defined as the process of ensuring access to financial services and timely and adequate credit where needed by vulnerable groups such as weaker sections and low income groups at an affordable cost (The Committee on Financial Inclusion, Chairman: Dr. C. Rangarajan).

17. Ans: c. 

Bank
Development (NABARD) is an apex development financial institution in India, headquartered at Mumbai with branches all over India. The Bank has been entrusted with "matters concerning policy, planning and operations in the field of credit for agriculture and other economic activities in rural areas in India". NABARD is active in developing financial inclusion policy and is a member of the Alliance for Financial Inclusion.

18. Ans: a. 

Money Lenders
The RBI is the supreme monetary and banking authority in the country and controls the banking system in India. It is called the Reserve Bank' as it keeps the reserves of all commercial banks. A scheduled bank is a bank that is listed under the second schedule of the RBI Act, 1934.

19. Ans: e, 

1, 2, 3, 4 and 5

20. Ans: b. 

Bank of Hindustan
Among the first banks were the Bank of Hindustan, which was established in 1770 and liquidated in 1829–32; and the General Bank of India, established in 1786 but failed in 1791. The largest bank, and the oldest still in existence, is the State Bank of India (S.B.I). It originated as the Bank of Calcutta in June 1806.

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