Banking Awareness Quiz – Set 89

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. The rules framed in the Clayton’s case have been incorporated in _________
   A. Banking Regulation Act, 1949
   B. Reserve Bank of India Act, 1934
   C. Negotiable Instruments Act, 1881
   D. Indian Contract Act, 1872
   E. None of the Above
   
   Answer & Explanation

   D. Indian Contract Act, 1872
   Explanation:
   The rules framed in the Clayton’s case was incorporated in Section 59 of the Indian Contract Act, 1872.
   
   
2. The Definition of ‘Banking’ is given in _______
   A. Negotiable Instrument Act, 1881
   B. RBI Act, 1934
   C. The Banking Regulation Act, 1949
   D. Indian Contract Act, 1872
   E. None of the Above
   
   Answer & Explanation

   C. The Banking Regulation Act, 1949
   Explanation:
   As per Section 5(b) of the Banking Regulation Act, 1949 , “banking” means the accepting, for the purpose of lending or investment, of deposits of money from the public, repayable on demand or otherwise, and withdraw-able by cheque, draft, order or otherwise.
   
   
3. Banks are required to maintain SLR under_____
   A. Section 24 of the Banking Regulation Act
   B. Section 35 of the Negotiable Instrument Act, 1881
   C. Section 24 of RBI Act
   D. Section 40 of Indian Contract Act, 1872
   E. None of the Above
   
   Answer & Explanation

   A. Section 24 of the Banking Regulation Act
   Explanation:
   SLR is governed by the provisions of Section 24 of the Banking Regulation Act. There is no minimum stipulation on SLR (earlier there used to be a minimum stipulated SLR of 25% – but this was removed with an amendment to the Banking Regulation Act in 2007).
   However, SLR can not exceed 40%.
   
   
4. Which of the following was/were established under the Recovery of Debts Due to Banks and Financial Institutions Act (RDDBFI Act), 1993?
   A. DRTs
   B. DRATs
   C. ATs
   D. Both (A) and (B)
   E. None of the Above
   
   Answer & Explanation

   D. Both (A) and (B)
   Explanation:
   The Debts Recovery Tribunals (DRTs) and Debts Recovery Appellate Tribunal (DRATs) were established under the Recovery of Debts Due to Banks and Financial Institutions Act (RDDBFI Act), 1993 with the specific objective of providing expeditious adjudication and recovery of debts due to Banks and Financial Institution.
   
   
5. Which of the following is governed by the provisions of Section 42 of the Reserve Bank of India Act, 1934?
   A. Bank rate
   B. Reverse Repo Rate
   C. SLR
   D. CRR
   E. None of the Above
   
   Answer & Explanation

   D. CRR
   Explanation:
   CRR is governed by the provisions of Section 42 of the Reserve Bank of India Act, 1934.
   There is no minimum & maximum level of CRR. We could go upto zero CRR (negative values are of course absurd).
   
   
6. A Shareholder has been defined by ________
   A. Banking Regulation Act, 1949
   B. Reserve Bank of India Act, 1934
   C. Negotiable Instruments Act, 1881
   D. Indian Contract Act, 1872
   E. The companies act, 1956
   
   Answer & Explanation

   E. The companies act, 1956
   Explanation:
   The Companies Act, 1956
   “Small Shareholder” means a shareholder holding shares of nominal value of twenty thousand rupees or less in a public company to which section 252 of the Act applies.
   
   
7. Spurious coins detected at the counter are sent to _____
   A. RBI
   B. GOI
   C. IBRD
   D. Mint
   E. None of the Above
   
   Answer & Explanation

   D. Mint
   Explanation:
   when Spurious coins tendered over the counter, it should be cut and handed over to the tenderer. If the tenderer disputes it, the coins should be sent to the mint at his cost, for examination.
   
   
8. On a Cheque instead of two parallel lines only bank’s name is written is known as _________
   A. Payable to bearer
   B. General Crossing
   C. Special Crossing
   D. Both (B) and (C)
   E. None of the Above
   
   Answer & Explanation

   C. Special Crossing
   Explanation:
   When a particular bank’s name is written in between the two parallel lines the cheque is said to be specially crossed.The effect of special crossing is that the bank makes payment only to the banker whose name is written in the crossing. Specially crossed cheques are more safe than a generally crossed cheques.
   
   
9. Minimum period of reinvestment deposits is _______
   A. 2 months
   B. 3 months
   C. 6 months
   D. 9 months
   E. E. None of the Above
   
   Answer & Explanation

   C. 6 months
   Explanation:
   A Reinvestment Deposit Plan basically allows you to reinvest the interest earned on your deposit. Period of deposit 6 months to 10 years.
   
   
10. What is the minimum limit in reinvestment deposits?
    A. 100
    B. 500
    C. 1000
    D. 5000
    
    Answer & Explanation

    C. 1000
    Explanation:
    E. None of the Above
    The minimum deposit amount is Rs. 1,000/-. Initially deposits should be made only in multiples of Rs. 100/-. Renewals can be made in any amount.