Q120. What is a loan supplied jointly by multiple banks or financial institutions to one borrower called?
[WBCS Mains 2019]
A. Syndicated loan
B. A demand deposit
C. A letter of credit
D. A Treasury bill
Answer: (A) Syndicated loan
Explanation: In syndicated lending, several lenders provide a financing facility to a borrower under coordinated terms, often with a lead arranger. The arrangement shares credit exposure and allows large funding requirements to be met collectively.
Q119. In a bank-led financial inclusion model, what does the abbreviation BC stand for?
[WBCS Mains 2019]
A. Business Correspondent
B. Banking Capital
C. Budget Committee
D. Bond Custodian
Answer: (A) Business Correspondent
Explanation: Business Correspondents provide authorised basic banking services beyond conventional branches, often using technology and local agents. Their functions can include account facilitation, cash deposits and withdrawals, and remittance services under bank oversight.
Q118. Does an RBI reverse-repo operation conventionally inject or absorb banking liquidity?
[WBCS Mains 2019]
A. Always inject liquidity
B. Absorb liquidity
C. Issue equity shares
D. Reduce government debt automatically
Answer: (B) Absorb liquidity
Explanation: When banks place surplus funds with the RBI through reverse repos, liquidity is absorbed from the banking system for the operation’s duration. The precise framework has evolved, including the standing deposit facility.
Q117. What are the major groups included in India’s Wholesale Price Index?
[MPSC Rajyaseva GS I 2019]
A. Only consumer services
B. Primary articles, fuel and power, and manufactured goods
C. Only imported wheat
D. Banking deposits and share prices
Answer: (B) Primary articles, fuel and power, and manufactured goods
Explanation: The WPI groups covered primary articles, fuel and power, and manufactured products. It measures changes in prices at the wholesale producer level rather than returns on financial assets or consumer service prices.
Q116. On what date was demonetisation of the old ₹500 and ₹1,000 banknote series announced?
[WBCS Prelims 2019]
A. 8 November 2016
B. 1 January 2017
C. 15 August 2016
D. 31 March 2017
Answer: (A) 8 November 2016
Explanation: The Government announced withdrawal of legal-tender status of specified old five-hundred and one-thousand-rupee notes on 8 November 2016, effective under prescribed conditions from the next day. New denominations were subsequently issued.
Q115. In a banking examination, what is a non-performing asset usually understood to be?
[WBCS Prelims 2019]
A. A branch building
B. A loan with prolonged overdue payment
C. A government security held for statutory liquidity
D. Cash at a branch
Answer: (B) A loan with prolonged overdue payment
Explanation: A non-performing asset is a credit exposure failing prescribed income-recognition or repayment conditions. For many term loans, overdue interest or principal beyond ninety days is a standard threshold, subject to applicable RBI norms.
Q114. Who signs ₹100 banknotes issued by India’s central bank?
[WBCS Prelims 2019]
A. The Governor of the RBI
B. The Finance Secretary
C. The President of India
D. The Chief Election Commissioner
Answer: (A) The Governor of the RBI
Explanation: Rupee banknotes such as the ₹100 denomination carry the signature of the RBI Governor. The one-rupee note is the notable exception, bearing the signature of the Finance Secretary.
Q113. Which organisation runs the network linking ATMs across India?
[UPSC CSE Prelims 2018]
A. Indian Banks’ Association
B. National Securities Depository
C. National Payments Corporation of India
D. Reserve Bank of India
Answer: (C) National Payments Corporation of India
Explanation: NPCI operates the National Financial Switch, which supports interoperability among participating ATM networks. Its role in retail payment infrastructure is distinct from the RBI’s functions as central bank and from securities depositories that maintain records of financial securities.
Q112. What is the Merchant Discount Rate in card payments?
[UPSC CSE Prelims 2018]
A. A bank reward paid to merchants
B. A refund paid to card users
C. A fee charged to merchants for accepting customer card payments
D. A government grant for online merchants
Answer: (C) A fee charged to merchants for accepting customer card payments
Explanation: The Merchant Discount Rate is a processing charge borne by merchants for acceptance of eligible card transactions. It remunerates the payment-acceptance system and is not a cashback, direct public subsidy or reward automatically given to shopkeepers.
Q111. Which description best defines legal-tender money?
[UPSC CSE Prelims 2018]
A. Money only used to pay court fees
B. Money which a creditor must accept in discharge of a debt under the law
C. Every bank cheque and bill
D. Only coins made from precious metals
Answer: (B) Money which a creditor must accept in discharge of a debt under the law
Explanation: Legal tender has recognition under law for settling monetary obligations within applicable limits. It is different from instruments such as cheques that generally require acceptance by agreement. The concept does not refer exclusively to legal proceedings or to metal content.
