Test: Principles and Practices of Banking - 4 - Bank Exams MCQ

Fedwire is primarily used for transferring reserve account balances of depository institutions and Government securities, high-value domestic payments, bank-to-bank, third-party transfers, and corporate-to-corporate payments made through banks. Fedwire is an X.25 protocol-based packet-switched network.

Facilitation of prompt credit at attractive interest, recognition in global trade, assistance in vendor assessment of MSEs benefits are provided by Performance and Credit Rating to MSEs.

The CMD (Chairman and Managing Director) or the (Executive Director) of the bank is recommended to chair the Standing Committee on Customer Service.

The Tribunal and the Appellate Tribunal are not bound by the procedure laid down by the Civil Procedure Code, 1908, and shall be guided by the principles of natural justice, provisions of this Act, and Rules there under, and regulate their procedure.

e-RUPI is distributed only in digital form.

All the complaints against unfair contracts, where the value of goods or services paid as consideration does not exceed 10 Crore, are to be filed before the State Commission. Complaints, where the consideration exceeds 10 Crore, are to be preferred before the National Commission.

Backups are critical in a computerized bank to ensure that the data is accurate and complete. If there is a power outage, mechanical or processing failures, or any other interruption, the system must restart without distorting the completion of the records. Backups ensure that the data is saved and can be restored in the event of a system failure.

Banks can deal with conflicts of interest by identifying and preventing such conflicts, setting up institutional controls and mechanisms for handling these as per the degree of potential risks, and making full disclosures to the affected parties so that they are aware of the potential impact. Banks can take pre-emptive measures to avoid inappropriate or adverse consequences on the banks and some or all stakeholders.

The issuing bank is the bank that opens the letter of credit at the request of the applicant/buyer.

The scheme aims to provide short-term credit to farmers at an interest rate of 7% with an upper limit of Rs. 3 lakhs on the principal amount.

As per the guidelines for priority sector loans, no loan-related and ad-hoc service charges/inspection charges should be levied on priority sector loans up to Rs. 25,000.

Credit to NBFCs (including HFCs) for on-lending is permitted under priority sector lending, up to 5% of total PSL (Quarterly average).

RBI Net allows free format messaging without any restrictions on the length of the message.

Banks and financial institutions have put in place best security practices and procedures under the guidance of regulators to counter cyberattacks and fraud.

Banks are required to publish at least five MCLRs viz. overnight MCLR; one-month MCLR; three-month MCLR; six-month MCLR; and One-year MCLR. Banks are free to publish MCLRs of longer maturity. Each MCLR is to be reviewed every month on the pre-announced date.

No court can entertain any suit, application, or other proceedings in respect of any order made under this Act, and no such order shall be called in question otherwise than by way of an appeal under this Act.

The disputes or differences with colleagues should not be debated in public and should be dealt with in private, possibly with the help of a senior if required.

Before granting an advance against the security of immovable property, it is necessary to get it valued by an approved engineer of the bank.

"Apparent tenor" means the instructions of the drawer of the cheque, as apparent from looking at the face of the cheque, and includes the date of the cheque, name of payee, bearer or order, the amount in words and figures, crossing, etc.

EBT was implemented through the Direct Benefit Transfer (DBT) Model, which aimed to transfer subsidies and cash benefits directly to the beneficiaries’ Aadhaar-seeded bank accounts. This model was started under the One District One Bank initiative.

The law does not debar a married woman from seeking an advance from a bank. She should be treated on the same footing as a man. Her husband will not be liable for her borrowings, except where he has joined as a co-borrower or a guarantor.

Banks should not execute guarantees covering inter-company deposits/ loans thereby guaranteeing a refund of any type of deposits/ loans accepted by NBFCs/ firms.

As per Sec. 17 of the Act, all instruments chargeable with duty and executed by any person in India shall be stamped before or at the time of execution.

FEMA replaced FERA in 2000. FERA was introduced in 1947 and was replaced by a more comprehensive Foreign Exchange Regulation Act, in 1973.

Business ethics is not an oxymoron because ethical practices provide a significant competitive advantage in the long run, and a business manager's ultimate objective is to create value for the business and build trust with society. An ethical organization would compensate redundant staff and assist them in finding new jobs to earn a living, and would not adopt wrongful acts like bribery, corruption, theft, fraud, insider trading, etc. prevalent externally in the society/industry.

Ethics as a concept in Indian business evolved during the 1980s, following the rise of corrupt business practices.

The most important question for a manager during the Pre-Crisis Stage is how to identify a crisis in time and prevent it.

With this feature, customers can pre-authorize a transaction and block the funds in their account for a debit to be initiated later. The mandate is digitally signed and stored at the customer's account holding bank and also with the customer's PSP bank (app-providing bank).

According to the general principles of agency law, an agent's remuneration becomes due to them upon completion of the act for which they were appointed by the principal. This means that the agent is entitled to receive their remuneration only after they have completed the task assigned to them by the principal. For example, if an agent is appointed by a principal to sell a property, the agent's remuneration becomes due only after the sale is completed, and the property is transferred to the buyer. The agent cannot claim their remuneration before the completion of the sale.

Banks extend finance for meeting working capital needs in the form of Cash Credit/ Overdraft facilities and Bills Finance. Bill finance is extended in the form of Bill Purchase, Bill Discounting, or Advance against Bills for Collection. All these facilities are amenable to fluctuating nature of working capital requirements.