Banking & Finance MCQs

The RBI mandated that loan disbursals and repayments must be executed directly between the borrower and the Regulated Entity (RE) without any pass-through account or pool account of the Lending Service Provider (LSP). This ensures transparency and accountability.

The Ombudsman can award compensation up to ₹20 lakh for any loss suffered by the complainant. An additional ₹1 lakh can be awarded for mental agony and harassment.

The Integrated Ombudsman Scheme covers deposit-taking NBFCs and non-deposit-taking NBFCs with an asset size of ₹50 crore and above. Entities below this threshold are generally not covered. Credit Information Companies are also covered.

The RBI introduced the Integrated Ombudsman Scheme, 2021, which subsumed the earlier separate ombudsman schemes for banking, NBFCs, and digital transactions, providing a single point of reference for customer grievances.

The RBI guidelines explicitly state that large industrial houses are not eligible to promote SFBs. Existing NBFCs, Payment Banks, and Local Area Banks are eligible.

The guidelines require promoters to reduce their stake to 40% within 5 years, 30% within 10 years, and 26% within 15 years from the commencement of business.

The RBI's 'on-tap' licensing guidelines for SFBs (December 2019), which are the current framework, stipulate a minimum paid-up voting equity capital of ₹200 crore.

The rise in sophisticated cyberattacks and financial frauds targeting digital banking platforms has necessitated the RBI to issue updated guidelines to bolster security measures.

While specific mandates can vary, enhanced security often involves stronger authentication methods like multi-factor authentication, including biometrics, for sensitive digital transactions.

The new RBI guidelines are primarily focused on enhancing the security of digital banking services to protect customers from increasing digital frauds and cyber threats.