Banking & General Financial Awareness
Banking & General Financial Awareness Multiple Choice Questions (MCQs) and Answers with explanation for All Banking Exams of 2024-25 such as IBPS Bank PO, IBPS Bank Clerical, RRB PO and Clerical, SBI PO and SBI Clerical, IBPS Recruitments, RBI Grade B and RBI Banking Examinations.
1. Which of the following institutions issue the Special Drawing Rights?
[A] IMF
[B] World Bank
[C] RBI
[D] BIS
Show Answer
Correct Answer: A [IMF]
Notes:
The SDR is an international reserve asset, created by the IMF in 1969.The main purpose was to supplement its member countries’ official reserves. The SDR is neither a currency nor a claim on the IMF. Rather, it is a potential claim on the freely usable currencies of IMF members. SDRs can be exchanged for these currencies.
2. Who pays for the Credit Ratings in India?
[A] RBI
[B] Government of India
[C] Issuer
[D] SEBI
Show Answer
Correct Answer: C [Issuer]
Notes:
Most credit rating agencies across the world use a revenue model where the issuer pays for the credit rating. In India, the issuer company pays for the credit rating.
3. What is the maximum loan duration for the Personal Loan?
[A] 1-5 years
[B] 2-4 years
[C] 1-8 years
[D] 1-10 years
Show Answer
Correct Answer: A [1-5 years]
Notes:
Maximum loan duration for the Personal Loan can be 1 to 5 years or 12 to 60 months. Shorter or longer tenures may be allowed on a case by case basis, but it is rare.
4. When did the private companies got the permission to set up Mutual Funds?
[A] 1992
[B] 1993
[C] 1994
[D] 1982
Show Answer
Correct Answer: A [1992]
Notes:
In 1992 private companies also got permission to setup Mutual Funds and SEBI (Mutual Funds) Regulation 1993 provides guidelines for registration, constitution, management and schemes of Mutual Funds in India.
5. What type of loan is a Housing loan?
[A] Unsecured Loan
[B] Secured Loan
[C] Corporate Loan
[D] Consumer Loan
Show Answer
Correct Answer: B [Secured Loan]
Notes:
Housing loan is a secured loan that is backed by an asset or equipment. The asset is called collateral. This collateral is needed because the amount of loan in the case of secured loan is much higher.
6. What is the full form of APR?
[A] Annual Priority Rates
[B] Annual Percentage Rates
[C] Amoritized Priority Rates
[D] None of the above
Show Answer
Correct Answer: B [Annual Percentage Rates]
Notes:
An annual percentage rate (APR) is the annual rate charged for borrowing through an investment. It is expressed as a percentage that represents the actual yearly cost of funds over the term of a loan.
7. Factoring Business is also known as by which of the following names?
[A] Accounts Receivable Factoring
[B] Asset Based Lending
[C] Invoice Factoring
[D] All of the Above
Show Answer
Correct Answer: D [All of the Above]
Notes:
Factoring is commonly referred to as accounts receivable factoring, invoice factoring, and sometimes accounts receivable financing. Accounts receivable financing is a term more accurately used to describe a form of asset based lending against accounts receivable.
8. In which year for the first time a bill was introduced in the Indian Legislative Assembly for the creation of RBI?
[A] 1927
[B] 1928
[C] 1929
[D] 1930
Show Answer
Correct Answer: A [1927]
Notes:
In 1927, a bill to create the central bank for India was introduced in the Legislative Assembly. But it was later withdrawn due to lack of agreement among various sections of people.
9. When was Deposit Insurance and Credit Guarantee Corporation established under RBI?
[A] 1976
[B] 1978
[C] 1981
[D] 1969
Show Answer
Correct Answer: B [1978]
Notes:
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.
10. Where is the head office of Bharatiya Reserve Bank Note Mudran Pvt. Ltd.?
[A] Chennai
[B] New Delhi
[C] Hyderabad
[D] Bangalore
Show Answer
Correct Answer: D [Bangalore]
Notes:
Bharatiya Reserve Bank Note Mudran Pvt. Ltd. is headquartered in Bangalore, Karnataka. Established in 1995, it prints and supplies banknotes to meet the demands of the Reserve Bank of India.
