MCQs on Banking & Finance: RBI Policies, Bank Recap, UPI

1.

What existing technology is being leveraged for the UPI cross-border remittance pilot?

A SWIFT network

B Unified Payments Interface (UPI)

C FedWire Funds Service

D CHAPS Sterling system

2.

Which region's countries are among the first to pilot UPI for cross-border remittances?

A South Asian Association for Regional Cooperation (SAARC)

B Association of Southeast Asian Nations (ASEAN)

C Gulf Cooperation Council (GCC)

D European Union (EU)

3.

What is the significance of UPI piloting cross-border remittances, particularly starting with GCC countries?

A It aims to reduce the number of international payment options.

B It seeks to make cross-border remittances faster, cheaper, and more accessible.

C It is intended to promote the use of physical currency for international transactions.

D It focuses on limiting remittances to only business purposes.

4.

What is a potential benefit of recapitalizing Public Sector Banks for the broader economy?

A Increased inflation due to more money supply.

B Reduced foreign investment in the banking sector.

C Improved credit flow to businesses and individuals, stimulating economic activity.

D Higher interest rates on savings accounts.

5.

How is the recapitalization of Public Sector Banks typically done by the government?

A By issuing new currency notes and distributing them to banks.

B By purchasing shares of PSBs, thereby infusing capital.

C By asking depositors to contribute additional funds.

D By taking loans from international financial institutions and channeling them to PSBs.

6.

What is the primary reason for the government to announce a major recapitalization for Public Sector Banks (PSBs)?

A To reduce the number of PSBs in the country.

B To improve their lending capacity and financial health to support economic growth.

C To encourage PSBs to invest more in the stock market.

D To facilitate the privatization of PSBs.

7.

What is a significant change introduced by the RBI's enhanced digital lending guidelines regarding upfront collection of fees?

A Lenders can collect all fees upfront from borrowers.

B All fees must be collected by the lending entity itself.

C Fees can only be collected by the lending entity from the borrower's account with their explicit consent.

D Third-party collection of fees is now mandatory.

8.

Under the new RBI digital lending guidelines, which entities are permitted to undertake digital lending activities?

A Only non-banking financial companies (NBFCs) registered with the RBI.

B Only banks and NBFCs regulated by the RBI.

C Any entity that registers with the Ministry of Corporate Affairs.

D Only fintech companies with a minimum paid-up capital of INR 1 crore.

9.

Which of the following is a key objective of the enhanced digital lending guidelines unveiled by the RBI?

A To promote unregulated lending platforms.

B To protect borrowers' interests and ensure fair lending practices.

C To increase the number of loan apps without any oversight.

D To allow lenders to charge arbitrary interest rates.

Banking & Finance MCQs - 2026-06-12