Banking Financial Awareness ยท General Awareness
Banking Services and Operations
1,239 Questions
Banking Services and Operations cover the fundamental principles of financial institutions, including credit markets, money supply, and risk management. It also addresses various transaction methods and account types used by businesses. This topic is crucial for candidates preparing for banking and insurance recruitment examinations.
Banking AbbreviationsCredit Market OperationsMoney Supply MetricsRisk Management MeasuresForeign Exchange RulesDigital Banking Technology
Banking Services and Operations Questions
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Credit cards
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Loan against gold from financial institute
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Debit cards
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Money lender
D
Correct answer
Explanation
Informal credit refers to lending outside the formal banking system, such as money lenders, friends, or relatives, which often lack regulation.
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True
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False
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Both (1) and (2)
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None of the above
A
Correct answer
Explanation
ATMs can operate in offline mode, where they do not connect to the host bank server in real time for every transaction. This is often used in remote areas or during network outages.
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Off-line
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On-line
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Both (1) and (2)
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None of the above
B
Correct answer
Explanation
Online UPS systems are preferred in banking because they provide continuous, clean power by converting incoming AC to DC and then back to AC, protecting sensitive equipment from power fluctuations.
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Medium of exchange
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Store of value
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Standard of deferred payment
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Mobilisation of savings
A
Correct answer
Explanation
The primary functions of money are medium of exchange and measure of value. The others are secondary functions.
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deposit system
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minimum reserve system
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residual system
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proportionate reserve system
B
Correct answer
Explanation
The system is called minimum reserve system.
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more
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less
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equal
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none of these
A
Correct answer
Explanation
The intrinsic value of token money is less than its face value.
A
Correct answer
Explanation
M-1 is covered under narrow money definition.
M-3 is called broad money.
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Issuing currency
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Providing trade information
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Issuing letter of credit
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Accepting deposits
D
Correct answer
Explanation
The two primary functions of Bank are: Accepting deposits and making advances.
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Fixed deposits
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Recurring deposits
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Saving deposits
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All of these
C
Correct answer
Explanation
Saving deposits are payable on demand.
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more NPA's
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lack of capital formation
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frauds
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less industrialisation
A
Correct answer
Explanation
The non performing assets are the main reason for low profitability in banking sector. The others are the minor issues.
B
Correct answer
Explanation
Modern ATMs provide the facility to print mini-statements of accounts for customers, making the statement that it is not possible false.
A
Correct answer
Explanation
The cash budget method is a standard financial tool used by banks to assess the liquidity and working capital requirements of businesses with fluctuating cash flows, such as seasonal or project-based industries.
B
Correct answer
Explanation
Business Process Re-engineering (BPR) is highly applicable to banks to improve efficiency, reduce costs, and enhance customer service, regardless of existing procedures.
A
Correct answer
Explanation
Modern commercial banks offer a wide range of consultancy and advisory services, including financial planning, tax advice, and project financing, as part of their fee-based services.
A
Correct answer
Explanation
Agency functions of commercial banks include collecting cheques, paying bills, and remitting funds on behalf of customers, acting as their agent.