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. According to International Monetary Fund, the countries with Foreign exchange controls are known by which of the following names?
[A] Article 14 countries
[B] Article 17 countries
[C] Article 16 countries
[D] Article 18 countries
Show Answer
Correct Answer: A [Article 14 countries]
Notes:
Countries with foreign exchange controls are known as “Article 14 countries”, after the provision in the International Monetary Fund agreement which allows exchange controls for transitional economies.
2. Which of the following are among the direct methods of exchange control in India?
[A] Intervention
[B] Exchange Restrictions
[C] Exchange Clearing Agreements
[D] All of the above
Show Answer
Correct Answer: D [All of the above]
Notes:
The direct methods of exchange control are adopted by the central bank with the object of restricting the use and the quantity of foreign exchange. These include intervention, exchange restriction, exchange clearing agreements and payments agreements.
3. India’s Foreign Exchange Reserve is maintained by which of the following institutions?
[A] RBI
[B] NABARD
[C] Central Government
[D] IMF
Show Answer
Correct Answer: A [RBI]
Notes:
Reserve Bank of India Act and the Foreign Exchange Management Act, 1999 set the legal provisions for governing the foreign exchange reserves. Reserve Bank of India accumulates foreign currency reserves by purchasing from authorized dealers in open market operations.
4. Which of the following countries has the largest Mutual Fund market in the World?
[A] USA
[B] Japan
[C] China
[D] Brazil
Show Answer
Correct Answer: A [USA]
Notes:
The country with the largest mutual fund industry is United States. It has an amount of $18.9 trillion. Mutual fund assets worldwide is approximately $40.4 trillion.
5. What is the meaning of the term Repayment Capacity?
[A] It is how much you pay in each EMI.
[B] It is the time in which one can repay Housing Loan.
[C] None of the options
[D] It is based on your monthly disposable income and other factors like spouse’s income, assets,
Show Answer
Correct Answer: D [It is based on your monthly disposable income and other factors like spouse’s income, assets,]
Notes:
The bank will assess repayment capacity while deciding the home loan eligibility. Repayment capacity is based on your monthly disposable / surplus income and other factors like spouse’s income, assets, liabilities, stability of income etc.
6. Which of these are at the lowest rung of Rural Cooperative banking structure in India?
[A] State Cooperative Banks
[B] District Central Cooperative Banks
[C] Primary Agricultural Credit Societies
[D] None of the above
Show Answer
Correct Answer: C [Primary Agricultural Credit Societies]
Notes:
Primary credit societies are at the lowest rung and operate at village level. Then, there are central cooperative banks at the district level and state cooperative banks at the state level.
7. Which of these committees in 1945 recommended the setting up of a Cooperative Training College in every state?
[A] Saraiya Committee
[B] Machalan Committee
[C] Narsimaham Committee
[D] Rajagopalachari Committee
Show Answer
Correct Answer: A [Saraiya Committee]
Notes:
Saraiya Committee, in 1945, further recommended the setting up of a Cooperative Training College in every state and a Cooperative Training Institute for Advanced Study and Research at the Central level.
8. In 2020, RBI cancelled the license of which Local Area Bank due to mismanagement?
[A] Subhadra Local Area Bank Ltd
[B] Coastal Local Area Bank Ltd
[C] Krishna Bhima Samruddhi Local Area Bank Ltd
[D] None of them
Show Answer
Correct Answer: A [Subhadra Local Area Bank Ltd]
Notes:
On December 24, 2020, Reserve Bank of India (RBI) cancelled the banking license issued to Subhadra Local Area Bank Ltd., Kolhapur, Maharashtra under Section 22 (4) of the Banking Regulation Act, 1949 to carry on banking business in India. RBI cancelled the license of the Subhadra Local Area Bank Ltd because its affairs were conducted in a manner detrimental to the interests of its present and future depositors. With this, this bank was closed down.
9. Which is India’s first Payment bank?
[A] PayTM Payments Bank
[B] JIO Payments Bank
[C] Airtel Payments Bank
[D] Fino Payments Bank
Show Answer
Correct Answer: C [Airtel Payments Bank]
Notes:
Bharti Airtel launched India’s first live payments bank named Airtel payment bank in March 2017. At present, there are 7 operational Payments Banks.
10. When was the SARFAESI Act enacted?
[A] 2004
[B] 2006
[C] 1999
[D] 2002
Show Answer
Correct Answer: D [2002]
Notes:
The Securitisation and Reconstruction of Financial Assets and Enforcement of Securities Interest Act, 2002 (or the SARFAESI Act) allows the banks and other financial institution to auction residential or commercial properties(of Defaulter) to recover loans.
