Q320. Which condition is inconsistent with the RBI regulatory meaning of a microfinance loan?
[SSC CGL Tier I, 24 Jul, Shift 3 2023]
A. The loan is collateral-free
B. It is made to an eligible low-income household
C. Its repayment is compulsorily secured by a lien on deposits
D. It has appropriate income-based eligibility
Answer: (C) Its repayment is compulsorily secured by a lien on deposits
Explanation: A qualifying microfinance loan is unsecured and collateral-free, directed to eligible low-income households. Making it dependent on a lien over a borrower’s deposits conflicts with the intended protection for low-income microfinance clients.
Q319. To discourage overall credit expansion, a central bank may take which step?
[SSC CGL Tier I, 24 Jul, Shift 1 2023]
A. Lower CRR
B. Buy bonds to add liquidity
C. Reduce SLR
D. Increase the bank rate
Answer: (D) Increase the bank rate
Explanation: Increasing the bank rate is associated with tighter financing conditions and higher borrowing costs. By comparison, lower reserve requirements or market purchases of securities generally release liquidity and can promote lending.
Q318. Which institution is normally called the lender of last resort to India’s banking system?
[SSC CGL Tier I, 21 Jul, Shift 3 2023]
A. SEBI
B. Regional Rural Banks
C. Reserve Bank of India
D. State Bank of India
Answer: (C) Reserve Bank of India
Explanation: The RBI may supply emergency liquidity to eligible financial institutions in exceptional circumstances under its central-banking framework. This lender-of-last-resort role helps contain otherwise disorderly shortages of cash within the banking system.
Q317. What is aggregate monetary resources M3 in India principally equal to?
[SSC CGL Tier I, 20 Jul, Shift 4 2023]
A. M1 plus net time deposits of commercial banks
B. Only coins in circulation
C. M1 minus demand deposits
D. Postal savings alone
Answer: (A) M1 plus net time deposits of commercial banks
Explanation: M3 is conventionally termed broad money and consists of narrow money M1 plus net time deposits with banks. It captures major bank deposits beyond immediately spendable cash and demand balances.
Q316. According to liquidity preference, what ordinarily happens to the demand for money when interest rates rise?
[SSC CGL Tier I, 20 Jul, Shift 2 2023]
A. It invariably triples
B. It tends to decline
C. It cannot change
D. It becomes exactly zero
Answer: (B) It tends to decline
Explanation: A rise in interest rates increases the opportunity cost of holding non-interest-bearing money instead of earning returns. This can lower desired speculative cash balances, though transactions demand also depends on income and payments.
Q315. Microcredit delivered through which community structure was tested in a 19 July SSC CGL paper?
[SSC CGL Tier I, 19 Jul, Shift 4 2023]
A. Customs tribunals
B. Self-help groups
C. Election committees
D. Local export councils
Answer: (B) Self-help groups
Explanation: Self-help groups consolidate small savings and facilitate access to credit for members who may lack conventional collateral or financial records. Bank-linkage models often support the group’s access to formal lending.
Q314. Which body was established following recommendations of the Hilton Young Commission?
[SSC CGL Tier I, 19 Jul, Shift 3 2023]
A. Securities and Exchange Board of India
B. Reserve Bank of India
C. State Bank of India
D. NABARD
Answer: (B) Reserve Bank of India
Explanation: The Royal Commission on Indian Currency and Finance, often called the Hilton Young Commission, recommended creation of a central bank. The RBI was later constituted under the 1934 Act and started operations in 1935.
Q313. Which is a formal institutional source of credit in the Indian economy?
[SSC CGL Tier I, 18 Jul, Shift 2 2023]
A. Unregistered moneylender
B. A village trader lending privately
C. An informal commission agent
D. Commercial bank
Answer: (D) Commercial bank
Explanation: Commercial banks supply institutional credit within a regulated system, unlike informal lenders or traders who may extend personal credit. Formal banking enables documented terms, supervision and access to payment and deposit services.
Q312. What does the third letter of BFSI stand for?
[SSC CGL Tier I, 17 Jul, Shift 4 2023]
A. Inflation
B. Investment
C. Insurance
D. Index
Answer: (C) Insurance
Explanation: BFSI means Banking, Financial Services and Insurance. The umbrella label encompasses banking, lending, securities and insurance operations and is commonly used to describe India’s broader financial-services industry.
Q311. Under India’s conventional monetary aggregates, M2 adds what to M1?
[SSC CGL Tier I, 18 Jul, Shift 1 2023]
A. Post-office savings-bank deposits
B. National Savings Certificates only
C. Equity-market holdings
D. All corporate bonds
Answer: (A) Post-office savings-bank deposits
Explanation: The conventional M2 monetary measure adds post-office savings-bank deposits to M1. It should be distinguished from M3, which adds net time deposits of banks to the narrow-money aggregate.
