MCQs - 2026-04

The guidelines cover all Regulated Entities (REs) of the RBI (banks, NBFCs, etc.) and also the Lending Service Providers (LSPs) engaged by them for digital lending activities.

A key provision of the guidelines mandates that Regulated Entities (REs) must disclose the all-inclusive cost of digital loans to borrowers in the form of an Annual Percentage Rate (APR) to ensure transparency.

The new Digital Lending Guidelines aim to protect consumers from predatory lending practices, ensure fair practices, and bring transparency to the digital lending ecosystem.

The Monetary Policy Committee (MPC) is a statutory body of the Reserve Bank of India, entrusted with the task of fixing the benchmark policy interest rate (repo rate) to achieve the inflation target.

Maintaining the repo rate means there is no change in the policy rate. Therefore, the immediate cost of borrowing for commercial banks from the RBI remains unchanged.

The Repo Rate is the rate at which the Reserve Bank of India (RBI) lends money to commercial banks in the event of any shortfall of funds. It is a key tool for controlling inflation and managing liquidity in the economy.

Women entrepreneurs have been the primary beneficiaries of the Mudra Yojana, accounting for approximately 70% of the total loans sanctioned.

One of the most significant features of PMMY is that the loans are collateral-free, which helps small entrepreneurs who lack assets.

MUDRA was set up as a subsidiary of the Small Industries Development Bank of India (SIDBI).

The maximum loan amount that can be sanctioned under the PMMY scheme is ₹10 lakh.