Banking Awareness Quiz – Set 118

Hello Aspirants,
Welcome to Banking Awareness Quiz in AffairsCloud.com. Here we are creating quiz covering important questions which are common for all the bank exams and other competitive exams.

1. What is the initial capital amount to start Small Finance Banks?
   A. 100 crore
   B. 200 crore
   C. 500 crore
   D. 1000 crore
   E. None of these
   
   Answer & Explanation

   A. 100 crore
   Explanation:
   The firms must have a capital of ₹100 crore to set up small finance banks. Existing non-banking financial companies (NBFC), micro-finance institutions (MFI) and local area banks (LAB) are allowed to set up small finance banks. 
   
   
2. The promoters of Small Finance Banks should have _______ experience in banking and finance?
   A. 8 years
   B. 11 years
   C. 7 years
   D. 10 years
   E. None of these
   
   Answer & Explanation

   D. 10 years
   Explanation:
   The promoters of Small Finance Banks should have 10 years experience in banking and finance
   
   
3. If a promoter setting up a small finance bank desires to set up a Payments Bank, the firm should set up both types of banks under a _______ structure
   A. NBFC
   B. NOFHC
   C. LAB
   D. MFI
   E. None of these
   
   Answer & Explanation

   B. NOFHC
   Explanation:
   If a promoter setting up a small finance bank desires to set up a Payments Bank, the firm should set up both types of banks under a Non-Operative Financial Holding Company (NOFHC) structure
   
   
4. What is the initial stake of promoters in the paid-up equity capital of Small Finance Banks?
   A. 25%
   B. 30%
   C. 45%
   D. 50%
   E. 40%
   
   Answer & Explanation

   E. 40%
   Explanation:
   The initial stake of promoters in the paid-up equity capital of Small Finance Banks is 40% and it can be reduced to 26% for 12 years.
   
   
5. How much percentage of the net credits of Small Finance Banks should be in priority sector lending?
   A. 25%
   B. 30%
   C. 45%
   D. 50%
   E. 75%
   
   Answer & Explanation

   E. 75%
   Explanation:
   75% of the net credits of Small Finance Banks should be in priority sector lending.
   
   
6. The small finance bank shall be registered as a _________company under the Companies Act, 2013.
   A. Private Limited
   B. Unlimited
   C. Public limited
   D. Limited Liability Partnership
   E. None of these
   
   Answer & Explanation

   C. Public limited
   Explanation:
   The small finance bank shall be registered as a public limited company under the Companies Act, 2013
   
   
7. The small finance bank cannot be a _______ for another bank.
   A. Agent
   B. Promoter
   C. Business Correspondent (BC)
   D. Ombudsman
   E. None of these
   
   Answer & Explanation

   C. Business Correspondent (BC)
   Explanation:
   The small finance bank cannot be a Business Correspondent (BC)for another bank.
   
   
8.  In Payment Banks, the stake of the promoter should be 40% minimum for ______ years
   A. 3 years
   B. 4 years
   C. 5 years
   D. 2 years
   E. 6 years
   
   Answer & Explanation

   C. 5 years
   Explanation:
   In Payment Banks, the stake of the promoter should be 40% minimum for the first five years.
   
   
9. In Payment Banks, the voting right of any shareholder is capped at 10%, which can be raised to __ ___by Reserve Bank of India.
   A. 26%
   B. 30%
   C. 45%
   D. 50%
   E. 75%
   
   Answer & Explanation

   A. 26%
   Explanation:
   In Payment Banks, the voting right of any shareholder is capped at 10%, which can be raised to 26% by Reserve Bank of India.
   
   
10. The minimum capital requirement Payment Banks is Rs.________
    A. 100 crore
    B. 50 crore
    C. 500 crore
    D. 1000 crore
    E. None of these
    
    Answer & Explanation

    A. 100 crore
    Explanation:
    The minimum capital requirement Payment Banks is Rs. 100 crore