Banking & Finance MCQs - October 28, 2026

1.

Why is Multi-Factor Authentication (MFA) considered a crucial cybersecurity measure for banking transactions?

A It reduces transaction processing time.

B It eliminates the need for passwords entirely.

C It adds an extra layer of security by requiring multiple verification methods.

D It allows for anonymous transactions.

2.

Which of the following is a common social engineering cyber threat where attackers attempt to trick individuals into revealing sensitive information, often through deceptive emails or messages?

A DDoS Attack

B Ransomware

C Phishing

D SQL Injection

3.

Which framework issued by the RBI provides comprehensive guidelines for banks to manage and mitigate cyber risks?

A Payment and Settlement Systems Act, 2007

B Cyber Security Framework for Banks

C Banking Regulation Act, 1949

D Information Technology Act, 2000

4.

In the context of monetary policy, what does the Repo Rate signify?

A The rate at which commercial banks lend money to the RBI.

B The rate at which the RBI lends money to commercial banks for short-term needs.

C The rate at which commercial banks lend money to their customers.

D The rate at which the government borrows from the public.

5.

What is the primary objective of the Monetary Policy Committee (MPC) as mandated by the Reserve Bank of India Act, 1934?

A To maximize employment generation.

B To maintain price stability while keeping in mind the objective of growth.

C To regulate foreign exchange markets.

D To ensure financial inclusion across all sectors.

6.

How many members constitute the Monetary Policy Committee (MPC) of the Reserve Bank of India?

A Five

B Six

C Seven

D Eight

7.

What is the primary purpose of the 'cooling-off' or 'look-up' period introduced by RBI in digital lending guidelines?

A To allow borrowers to negotiate a lower interest rate.

B To provide borrowers an option to exit the loan by repaying the principal without penalty.

C To enable lenders to re-evaluate the borrower's creditworthiness.

D To facilitate faster loan processing for repeat customers.

8.

Which document is mandated by RBI for digital loans to ensure transparency regarding the loan terms and conditions for borrowers?

A Annual Financial Statement (AFS)

B Key Fact Statement (KFS)

C Loan Sanction Letter (LSL)

D Credit Information Report (CIR)

9.

As per RBI's enhanced digital lending norms, how must the loan disbursal and repayment be handled?

A Directly between the borrower's bank account and the Regulated Entity (RE) without any pass-through.

B Through a Lending Service Provider (LSP) acting as an intermediary.

C Via a digital wallet linked to the LSP.

D Cash disbursal is permitted for small-ticket loans.

Banking & Finance MCQs - 2026-10-28