SBI Clerk

Basic Banking Knowledge

1. As per the latest orders, all participating banks and Prepaid Payment Instrument (PPI) issuers shall not levy any charges on customers for transactions up to Rs. 1000 settled on which of the following methods?
a) Immediate Payment Service (IMPS)
b) USSD-based *99#
c) Unified Payment Interface (UPI) systems
d) All the above
e) None of these

2. Banks should provide adequate number of which of the following, at their counters to take care of the work load and timely detection of counterfeit notes?
a) Note counting machines
b) UV Lamps
c) Note sorting machines
d) All the above
e) None of these

3. What is MDR? Give details.
a) Merchant Discount Rate (MDR).
b) For transactions up to Rs. 1000/-, MDR shall be capped at 0.25% of the transaction value.(for debit card based transactions)
c) For transactions above Rs. 1000/- and up to Rs.2000/-, MDR shall be capped at 0.5% of the transaction value.(for debit card based transactions)
d) These rates are decided under Section 10(2) read with Section 18 of Payment and Settlement Systems Act 2007, (Act 51 of 2007)
e) All the above

4. In the abbreviation NPLs, the letter L stands for what?
a) Loan (NPLs: Non-Performing Loans)
b) Life
c) Leave
d) Look
e) None of these

5. Pradhan Mantri Garib Kalyan Deposit Scheme (PMGKDS), 2016 is applicable to whom ?
a) Every declaration under the Taxation and Investment Regime for Pradhan MantriGaribKalyanYojana, 2016.
b) Government employees only
c) Private sector employees only
d) Public sector banks only
e) None of these

6. Which of the following is a correct statement?
a) Normally no interest is paid on current deposit accounts
b) Interest is paid on current accounts at the same rate as term deposit accounts
c) The rate of interest on current account and savings account are the same
d) No interest is paid on any deposit by the bank
e) Savings deposits are the same as current deposits

7. “Scheduled bank” means what?
a) Bank incorporated under the companies act, 1956
b) Authorized to the banking business
c) Governed by the Banking Regulation Act, 1949
d) A bank included in the Second Schedule to the Reserve Bank of India Act, 1934
e) None of the above

8. For filing and resolving customer complaints the banking Ombudsman charges how much fees?
a) Charges a fee of Rs.500/-
b) Does not charge any fee
c) Charges a fee of Rs.1500/-
d) Charges a fee of Rs.1000/-
e) None of the above

9. For replacement of the defectively printed banknotes, which series number system is proposed by RBI?
a) Star series
b) Diamond series
c) Triangle series
d) Square series
e) None of these

10. When Taxation and Investment Regime for Pradhan Mantri Garib Kalyan Yojana, was announced?
a) 1978
b) 2016
c) 1946
d) 1934
e) None

11. Will any interest be paid on the deposit under the PMGKY?
a) 12 % p.a.
b) No interest shall be paid for deposits made in this scheme.
c) 18% p.a.
d) 24% p.a.
e) None of these

12. What is the minimum limit for depositing in the PMGKS?
a) The deposit by a declarant shall not be less than twenty-five per cent of the undisclosed income declared under sub-section
(1) of section 199C of the Taxation and Investment Regime for Pradhan Mantri Garib KalyanYojana, 2016. Deposit shall be made in multiples of Rs.100.
b) Rs.10/-
c) Rs.50/-
d) Rs.500/-
e) None

13. When will the deposit be repaid in PMGKS?
a) Within one year
b) Repayment of the deposit will be made after a period of 4 years from the effective date of deposit (ie., date of tender of cash or the date of realization of draft or cheque or transfer through electronic transfer)
c) Within 2 years
d) Within 3 years
e) None of these

14. What is Subordinated Debt (SD)?
a) It means an instrument which is fully paid-up, unsecured, subordinate to the claims of other creditors, free of restrictive clauses, and shall not be redeemable at the initiative of the holder or without the consent of the Bank
b) Public debt
c) Public sector industries debt
d) Public sector banks debt
e) None

15. Standalone Primary Dealers (SPDs) are registered as which type company with RBI?
a) Trust
b) Non-banking financial company
c) Chit Fund
d) Service Organisation
e) None of these

16. Reserve Bank of India was constituted under which section of the Reserve Bank of India Act, 1934?
a) Section 42
b) Section 3
c) Section 35
d) Section 24
e) None of these

17. Who is “Walk-in Customer” in banks?
a) It means a person who does not have an account based relationship with the bank, but undertakes transactions with the bank
b) Who walks before the bank
c) Who talks about banks
d) Who enquires about banks
e) None

18. What is “Customer Due Diligence (CDD)” in banks?
a) Making telephone calls
b) It means identifying and verifying the customer and the beneficial owner using ‘Officially Valid Documents’ as a ‘proof of identity’ and a ‘proof of address’
c) Sending fax messages
d) Sending notices
e) None of these

19. Who are “Politically Exposed Persons” (PEPs)?
a) Students
b) Individuals who are or have been entrusted with prominent public functions in a foreign country, e.g., Heads of States/ Governments, senior politicians, senior government/ judicial/military officers, senior executives of state-owned corporations, important political party officials, etc.
c) NGOs
d) Welfare Association leaders
e) None of these

20. Who are “Non-face-to-face customers”?
a) Who does not have account in banks
b) It means customers who open accounts without visiting the branch/offices of the REs or meeting the officials of REs.
c) Who enquires about the benefits in banks
d) Who propagates about the banks
e) None of these

21. What is”Wire transfer”?
a) It means a transaction carried out, directly or through a chain of transfers, on behalf of an originator person (both natural and legal) through a bank by electronic means with a view to making an amount of money available to a beneficiary person at a bank
b) Selling wires
c) Ultra wires
d) Telephone wires
e) None of these

22. What is “Shell bank”?
a) Bank in a shell
b) It means a bank which is incorporated in a country where it has no physical presence and is unaffiliated to any regulated financial group.
c) Banks in sea shells
d) Banks in islands
e) None of these

23. Give examples for Regulated Entities” (REs)?
a) All Scheduled Commercial Banks (SCBs)/ Regional Rural Banks (RRBs)/ Local Area Banks (LABs)/ All Primary (Urban) Co-operative Banks (UCBs) /State and Central Co-operative Banks (StCBs / CCBs) and any other entity which has been licenced under Section 22 of Banking Regulation Act, 1949, which as a group shall be referred as ‘banks’
b) All India Financial Institutions (AIFIs)
c) All Non-Banking Finance Companies (NBFCs)
d) All Payment System Providers (PSPs)
e) All the above

24. “Transaction” means what in financial institutions ?
a) A purchase
b) Sale, loan, pledge,
c) Gift, transfer
d) Delivery or the arrangement thereof
e) All the above

25. What is ‘Cultivation under controlled conditions’ for the categories of floriculture, horticulture, cultivation of vegetables and mushrooms?
a) Practice of cultivation wherein rainfall, temperature, solar radiation, air humidity and culture medium are controlled artificially
b) Under government control
c) Under foreign government control
d) Under the control of the private organisations
e) None of these

26. Any note, which is wholly or partially, obliterated, shrunk, washed, altered or indecipherable is called as what?
a) Mutilated note
b) Imperfect note
c) Soiled noted
d) Mismatched note
e) None of the above
27. ‘Tax Saver Scheme’ related to which of the following?
a) In the Finance Act 2006, Section 80C of Income Tax Act 1961 was amended to include deposits placed with a scheduled bank to qualify for deduction under 80C. In terms of the amendment a deposit scheme has been introduced with certain value added features for the benefit of customers.
b) It is for GST
c) It is for Octroi
d) It is for Central Excise Duty
e) None of these
28. What is the role of Central Vigilance Commission?
a) To encourage government business
b) The CVC shall, as the Designated Agency, receive written complaints or disclosure on any allegation of corruption or of misuse of office by any employee of the Central Government or of any corporation established under any Central Act, government companies, societies or local authorities owned or controlled by the Central Government
c) To encourage private business
d) To encourage appointment of relatives
e) None of these
29. A cheque becomes ‘stale’ after how many months?
a) Three
b) four
c) five
d) seven
e) None
30. In 1980 how many commercial banks were nationalised?
a) 14
b) Six
c) only one
d) three
e) None
31. Which of the following is a ‘temporary pass through account’ held by a third party during the process of a transactions between two parties?
a) Nostro account
b) Escrow Account
c) Ostro account
d) Demat account
e) None of these

32. Loan of very small amount is called as what?

a) Micro credit
b) Petty credit
c) Long term loans
d) Short term loans
e) None of these

33. NBFCs are prohibited from accepting which of the following?

a) Demand deposits (ex: current account deposits)
b) RDs
c) Gold deposits
d) Silver deposits
e) None of these

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