Q400. Which statement about UPI and the Digital Rupee is incorrect?
[UPSC CSE Prelims 2026]
A. UPI enables real-time payments while the digital rupee represents sovereign money
B. UPI shifts bank deposits whereas e-rupee moves digital cash between wallets
C. UPI debits appear in bank statements whereas wallet-to-wallet e-rupee transfers generally do not
D. In both UPI and digital-rupee transactions, liability rests with users and their banks
Answer: (D) In both UPI and digital-rupee transactions, liability rests with users and their banks
Explanation: A UPI payment transfers a claim on commercial banks. Digital rupees are liabilities of the Reserve Bank of India itself, like currency notes. Their risk and accounting treatment consequently differ, even though both may facilitate rapid retail payments.
Q399. For Non-Banking Financial Companies in India, which of the following are correct?
(1) They cannot accept demand deposits.
(2) Every NBFC must register with RBI.
(3) They may draw cheques on themselves.
(4) DICGC does not insure deposits in deposit-taking NBFCs.
[UPSC CSE Prelims 2026]
A. 1 and 4 only
B. 1, 2 and 3 only
C. 4 only
D. 2, 3 and 4 only
Answer: (A) 1 and 4 only
Explanation: NBFCs differ from banks in their access to deposits and settlement infrastructure. They cannot accept demand deposits or issue their own cheques. Insurance through DICGC protects eligible bank deposits, not NBFC deposits; some financial entities are regulated by authorities other than RBI.
Q398. What are the three dimensions of the RBI Financial Inclusion Index?
[UPSC CSE Prelims 2026]
A. Credit, insurance and pension
B. Banking, output and literacy
C. Access, usage and quality
D. Affordability, transparency and inclusion
Answer: (C) Access, usage and quality
Explanation: The RBI designed its Financial Inclusion Index around access to financial services, actual use of those services and their quality. The distinction is important: possessing an account is not equivalent to actively using reliable, affordable and suitably protected financial services.
Q397. What was the RBI Financial Inclusion Index reading for March 2024?
[MPPSC Prelims 2026]
A. 64.2
B. 62.4
C. 53.9
D. 59.3
Answer: (A) 64.2
Explanation: The RBI Financial Inclusion Index for March 2024 was 64.2, up from 60.1 in March 2023. The composite index combines access, usage and quality of financial services. Its improvement was particularly associated with greater usage of financial products and services.
Q396. In a postgraduate economics recruitment examination, what was identified as the foremost practical constraint on commercial-bank credit creation?
[UP PGT Economics, 10 May 2026]
A. Demand for loans
B. Government fiscal deficit alone
C. Volume of foreign reserves
D. Reserve ratios as the sole factor
Answer: (A) Demand for loans
Explanation: In practice, banks cannot indefinitely expand lending without creditworthy borrowers willing to borrow. Reserve requirements, capital adequacy and liquidity rules also constrain lending capacity, but the examination emphasised loan demand as the primary operational constraint.
Q395. In the context of RTGS and NEFT, which statement is correct?
(1) RTGS settles transactions individually in real time, whereas NEFT settles in batches.
(2) Inward RTGS transfers attract charges.
(3) RTGS is unavailable during certain holidays.
[UPSC CSE Prelims 2025]
A. Statement 1 only
B. Statements 1 and 2 only
C. Statements 1 and 3 only
D. Statement 3 only
Answer: (A) Statement 1 only
Explanation: RTGS handles transfers one by one in real time, while NEFT operates in settlement batches. Both RBI-operated systems now function throughout the year. Receiving banks do not levy charges on inward RTGS or NEFT transfers, making only the first statement valid.
Q394. Which regulator requires eligible listed companies to submit a Business Responsibility and Sustainability Report?
[UPSC CSE Prelims 2025]
A. Reserve Bank of India
B. Securities and Exchange Board of India
C. Insurance Regulatory and Development Authority of India
D. Pension Fund Regulatory and Development Authority
Answer: (B) Securities and Exchange Board of India
Explanation: BRSR disclosures concern environmental, social and governance performance of listed companies. SEBI, the securities-market regulator, sets this disclosure framework. RBI supervises banks and manages monetary policy but does not impose general listed-company sustainability-reporting requirements.
Q393. Which of these count as Alternative Investment Funds under Indian regulation: bonds, hedge funds, stocks and venture-capital funds?
[UPSC CSE Prelims 2025]
A. Only bonds and stocks
B. Only hedge funds and venture-capital funds
C. Bonds, stocks and hedge funds
D. All four
Answer: (B) Only hedge funds and venture-capital funds
Explanation: An Alternative Investment Fund is a pooled investment vehicle registered under SEBI rules. Hedge funds and venture-capital funds fall within its categories. Ordinary bonds and shares are instruments that investors may hold, but are not themselves alternative investment funds.
Q392. Why are bondholders generally exposed to less repayment risk than shareholders in a company?
[UPSC CSE Prelims 2025]
A. Bondholders lend to the company and generally have repayment priority
B. Bondholders are the principal owners of the company
C. Equity owners receive mandatory fixed interest
D. Shareholders legally rank ahead of creditors in liquidation
Answer: (A) Bondholders lend to the company and generally have repayment priority
Explanation: Bonds establish a creditor relationship; shares establish ownership. Contractual interest and the priority enjoyed by creditors in insolvency usually make bond claims less risky than equity claims. Shareholders bear residual losses and receive any remaining value only after creditors.
Q391. When did the RBI introduce the Lead Bank Scheme?
[SSC CGL Tier I 2025]
A. 1969
B. 1975
C. 1980
D. 1990
Answer: (A) 1969
Explanation: The Lead Bank Scheme was introduced in 1969 to coordinate district-level credit planning and expand banking services. A designated lead bank helps other financial institutions prepare and monitor credit plans, particularly for underserved districts and priority sectors.