BANKING AWARENESS

What are the reasons that lead to Nationalisation of banks ?
In view of the reluctance of Commercial Banks, before 1969, to finance small business ventures and agriculture and not opening branches in rural areas on account of low business potential, compelled the GOI to take over the control of banks by nationalising them.

What is the need for Financial Intermediaries in India.
Financial intermediaries play an important economic function by facilitating a productive use of the community’s surplus money, Transfer funds to those in need, Eliminate risks and Boost Economy.

What do you mean by teaser rates?
A teaser rate means, a low introductory interest rate on an adjustable rate mortgage (ARM), generally in home loans. The lender though charges low interest rate initially he will charge the real interest rate subsequently. The lender in this case has to tell future rate of interest to the borrower and also its date of commencement. In other words, the home loans which are neither at fixed rate nor at floating are called teaser rates? In fact, it a technique to entice the borrowers who otherwise unable to qualify a mortgage home loan. In view of the higher risk associated with such loans, the standard asset provisioning on the outstanding amount has been increased from 0.40 per cent to 2 per cent with immediate effect. The provisioning on these assets would revert to 0.40 per cent after 1 year from the date on which the rates are reset at higher rates if the accounts remain standard.

IDRBT – Institute for development & Research in Banking Technology
was set up by the RBI in 1996. The RBI formed a committee on "Technology Upgradation in the Payment Systems". The committee recommended a variety of payment applications which can be implemented with appropriate technology upgradation and development of a reliable communication network. As a result of the committee's recommendations the institute was established in Hyderabad.

The Society for Worldwide Interbank Financial Telecommunication SWIFT provides a network that enables financial institutions worldwide to send and receive information about financial transactions in a secure. The card may embed a hologram to avoid counterfeiting.. Mr J Harinarayan is the present Chairman. This implies that it can receive input which is processed by way of the ICC applications and delivered as an output. IRDA: A statutory body called the Insurance Regulatory Authority set up in 1996. Using smartcards also is a form of strong security authentication for single sign-on within large companies and organizations. Adjudicate disputes . or integrated circuit card (ICC). Memory cards contain only non-volatile memory storage components. Sales Tax etc. through SWIFT codes. SMART CARDS:A smart card. Renamed as Insurance Regulatory and Development Authority with the passage of IRDA Act. Income Tax. Banks will earn around Rs 45/per transaction from the concerned departments. and perhaps some specific security logic. The card is made of plastic. Microprocessor cards contain volatile memory and microprocessor components. 1999. Devise control activities for functioning of insurance companies. Lay down the accounting methodology. standardized and reliable environment. instead of going to the concerned departments like. is in any pocket-sized card with embedded integrated circuits which can process data. On the other hand this is an extra service and extra income to the banks. Promote orderly growth of insurance industry Registration of insurance companies Administer the provisions of Insurance Acts.OLTAS: Online tax accounting system is introduced to enable the customers to pay all their taxes in Bank itself. This type of income is called non-interesst income. There are two broad categories of ICCs. generally PVC. chip card. Central Excise. The headquarters of IRDA is at Hyderabad The major objectives of the IRDA Act are: Protect the policy holder’s / investor’s interest.

All the above C. None of the above C. State Bank of India E. Online Tax Assessment System C. OLTAS stands for A. The minimum paid up equity capital for carrying on reinsurance business has been prescribed as Rs. ATM Cards D. IDBI B. Online Tax Accounting System . Credit Cards E.The minimum paid up equity capital for life or general insurance business is Rs. None of the above 06. Practice Bits 01. None of the above C. Some of the institutions covered under all India DFIs are: A Industrial Finance Corporation of India (IFCI) B Industrial Development Bank of India (IDBI) C Industrial Credit and Investment Corporation of India (ICICI) D Industrial Investment Bank of India (IIBI) E All the above 05. Plastic money Exchanged electronically Includes: A. Which of the following are the essential characteristics of Money? A. Portability E. Online Tata Administrative Services D. Durability D.100 crores. The Imperial Bank of India was renamed as ? A. All the above C.B & C B.200 crores. All A. Online Tax Analysis System E. Reserve Bank of India D. Debit Cards D. Some of the products and services are: A. Internet Banking B. Updated technology enables the banks to provide efficient products and services. Smart Cards B. Union BanK of India 03. Divisibility 02. ATM Cards 04. Smart Cards B.Credit Cards E.

Banking Codes and State Bank of India E. Banking Codes and Standards Board of India D. BCSBI stands for: A. Society for Worldwide Indian Financial C. State Government and RBI B. Basel Committee for State Bank of India B. a low introductory interest rate on an Adjustable Rate Mortgage (ARM). State Government and NABARD B. Urban Cooeprative banks are controlled by ___________ and _______________ A. ___________has been set up for exchange of credit information among its members: A. IRDA C. ECGC C. SEBI E. Government of India D. Charging high rate of interest for HNIs D. DICGC B. A teaser rate means. None of the above 09. Rate of interest charged to college staff members E. Teaser Rate of Interest means: A. CIBIL D. SWIFT stands for A. EXIM BANK E. None of the above . generally in home loans B. IDRBT is a Banking Research Institute. Charging high rate of interest C. None of the above 12. Society for Worldwide Interbank Financial Telecommunication B. Only C E. Both State Government and Central Government D. __________regulates all aspects of Insurance Business A. ICRISAT C. RBI B. Reserve Bankj of India C. Banker Customer Stability Board of India C. Department of Information & Technology E. All the above 13. None of the above 10. RBI 08. None of the above 11. established in 1996 by: A. RBI and NABARD.07. AMFI D. E. Social net(Working) for International Funds Transfer D.

Name the scheme in Mutual Funds which is askin to recurring deposits? A. Convenience of banking 18. RBI C. Integrated Financial Services Code 11 A 12 B 13 A 14 D 15 A 16 B 17 E 18 A 19 C 20 A . Of Foreign Currency 15. RBI is popularly known as a lender: A. Demand Draft E. Mortgage ANSWERS 01 D 02 B 03 E 04 E 05 D 06 E 07 C 08 C 09 A 10 A B. Name the payment system where payment instructions are processed on a continuous basis: A. Open Ended scheme B. Term Deposit D.14. NABARD B. SEBI E. RTGS D. Quicker services E. ECS B. None of the above 20. Systematic Invetment Plan C. To State Government E. Which of the following organisations/agencies works solely to monitor and arrange flow of agriculture credit in India? A. Protocol Conversion Device C. Indian Forex Service Council D. None of the above 16. IFSC code represents: A. All the above E. ATM E. Indian Financial System Code F. All the above C. SIDBI D. None of the above C. Bond B. When banks accept a fixed sum of money from an individual for a definite term and pay on maturity with interest. the deposit is known as : A. Indian Financial Systematic Code C. Unit Linked Insurance Policy D. None of the above C. Easier access D. None of the above 17 The benefits of leveraging technology to the customer are: A. To Central Government D. Global access B. None of the above 19. Of the last resort B.