Banking & Finance MCQs - 2026-09-12

The RBI's Digital Lending Guidelines cover all commercial banks, primary (urban) co-operative banks, state co-operative banks, district central co-operative banks, and Non-Banking Financial Companies (including HFCs) that are Regulated Entities (REs) and the Lending Service Providers (LSPs) engaged by them.

The Digital Lending Guidelines mandate a 'cooling-off period' (or look-up period) during which borrowers can exit the loan by paying the principal and proportionate annual percentage rate (APR) without any penalty.

The Reserve Bank of India (RBI) issued comprehensive regulatory framework for digital lending in August 2022, which came into effect subsequently, to protect borrowers and ensure orderly growth of the sector.

The Monetary Policy Committee (MPC) consists of six members – three officials of the RBI and three external members nominated by the Government of India.

The Repo Rate is a key quantitative instrument through which the RBI injects liquidity into the system by lending to commercial banks against government securities. It is a direct tool to influence money supply.

The primary objective of the Monetary Policy Committee (MPC) is to maintain price stability while keeping in mind the objective of growth. The current inflation target is 4% with a band of +/- 2%.