Banking Awareness PYQs

The correct answer is 14 sectors.

Key Points

• The PLI Scheme for electronics manufacturing, the Union Cabinet chaired by Prime Minister Narendra Modi, on 11 November 2020, has introduced the Production-Linked Incentive (PLI) Scheme in 10 key sectors.
• In Union Budget 2022-23, there are 14 sectors in Production-Linked Incentive (PLI) Scheme.
• This means that minimum production in India as a result of PLI Schemes is expected to be over US$ 500 billion in 5 years.
• PLI Schemes are a cornerstone of the Government’s push for achieving an Atmanirbhar Bharat. The objective is to make domestic manufacturing globally competitive and to create global Champions in manufacturing.
• The Scheme of PLI for White Goods (ACs and LED Lights) is to be implemented over seven years from FY 2021-22 to FY 2028-29 and has an outlay of Rs. 6,238 Cr.

Additional Information

• **Production-Linked Incentive (**PLI) Scheme for White Goods for the manufacture of components and sub-assemblies of Air Conditioners (ACs) and LED Lights comes under the Ministry of Commerce & Industry, Department for Promotion of Industry & Internal Trade.
• Union Minister of Commerce & Industry: Shri Piyush Goyal$

The correct answer is INS Vagir.

In News

• India Navy will commission Kalvari class submarine Vagir on 23 January 2023.

Key Points

• The submarine has been built under the Project-75.
• It is built in India by Mazagon Dock Shipbuilders Limited, Mumbai in collaboration with Naval Group, France.
• It is capable of attacking underwater or on the surface with torpedoes and tube-launched anti-ship missiles.
• Formerly. Vagir was commissioned on 1 November 1973 and decommissioned on 07 January 2001 after three decades of service.
• Four of the Kalvari class of submarines have already been commissioned into the Indian Navy.
• INS Vagir undertook her maiden sea sortie in February 2021, marking the commencement of sea trials and has gone through a series of comprehensive acceptance checks and stringent and demanding sea trials.
• The submarine was delivered to the Indian Navy by the MDL on December 20.

Additional Information

• Project 75 intends to build 6 diesel-electric attack submarines of the Kalvari class that is based on the Scorpene-class.
• They are being built at Mazagon Dock Shipbuilders Limited (MDL) Mumbai in collaboration with M/s Naval Group, France.
• 6 submarines :
• Commissioned: INS Kalvari ,INS Khanderi, INS Karanj and INS Vela.
• Yet to be commissioned- INS Vagir and INS Vagsheer

The correct answer is Reserve Bank of India.

In News

• The spike in the trade deficit recently has probed experts to look at the Indian economy through the surveys conducted by RBI.

Key PointsConsumer Confidence Survey:

• The Consumer Confidence Survey provides an assessment of respondents’ perceptions on general economic conditions and their financial situation during the current period and a year ahead.
• It is a bi-monthly survey conducted by RBI asking households in 13 major cities — such as Ahmedabad, Bhopal, Guwahati, Patna, and Thiruvananthapuram — about their current perceptions and future expectations on a variety of economic variables.
• The variables used are general economic situation, employment scenario, overall price situation, own income and spending levels.
• Based on the responses, the RBI formulates two indices: the Current Situation Index (CSI) and the Future Expectations Index (FEI).
• The CSI depicts how people view their current situation (on income, employment etc.) vis a vis a year ago.
• The FEI shows how people expect the situation to be (on the same variables) a year from now.
• By looking at the two variables as well as their past performance, one can learn a lot about how Indians have seen themselves fairing over the years.

The correct answer is 'Indian Enterprises Rating Agency of India'.

Key Points

• The Reserve Bank of India released a list of six domestic credit rating agencies that banks are advised to use for risk weighting their claims about capital adequacy.
• The central bank listed Acuite Ratings & Research Limited, Credit Analysis and Research Limited (CARE), CRISIL Ratings Limited, ICRA Limited, India Ratings and Research Private Limited, and INFOMERICS Valuation and Rating Pvt Ltd.
• The RBI’s list comes after the fiasco surrounding Brickworks Ratings India Private Limited, which had its licence cancelled by the Sebi in October 2022 for allegedly violating rules.
• The SEBI directed the credit rating agency to wind down its operations within six months and barred it from taking any new clients.
• In October, the RBI had also issued instructions with regard to how banks would approach the matter.

Additional Information

• RBI said that regulated Entities/ Market Participantsa are advised that in respect of ratings/credit evaluations required in terms of any guidelines issued by the Reserve Bank, no such fresh ratings/evaluations shall be obtained from Brickwork Ratings India Private Limited.
• Regulators had highlighted several violations by Brickwork, including failure to follow a proper rating process and exercise due diligence while providing ratings.
• The SEBI inspected Brickwork for the periods April 2014 to September 2015 and April 2017 to September 2018, observing contraventions that led to initiation of separate adjudication proceedings against the agency.
• Subsequently, the SEBI undertook a joint inspection with RBI in January 2020 of the records and documents of Brickwork, for the period from October 2018–November 2019.

• RBI has set up a 5-year plan with the support of the Financial Inclusion Advisory Committee to formulate National Strategy for Financial Inclusion.
• It is for the period 2019-2024.
• National Strategy for Financial Inclusion was finalized and approved by the Financial Stability Development Council.
• RBI deputy director Mahesh Kumar Jain released the final documents.
• NSFI recommended increasing the outreach of banking outlets to provide financial inclusion to every village within a 5- kilometer radius.
• It has also recommended that the endeavor should be less cash society by enhancing digital payments by March 2022.

The correct answer is NABARD

Key Points

Agri-Clinics: 

• The setting up of Agri-Clinics is to provide expert advice to farmers on various aspects like soil health, cropping practices, plant protection, crop insurance, post-harvest technology, feed and fodder management, etc.

Agri-business centers:

• These are commercial agri-ventures for income generation & entrepreneurship development e.g. farm equipment, sale of agro-inputs, value-addition activities, livestock enterprises, etc.

Important Points

Agri-clinic and Agribusiness Centres Scheme

The scheme aims to establish Agri-Clinics and Agri-Business Centres (ACABC) all over the country.

Objectives of the scheme

• To supplement efforts of public extension by necessarily providing extension and other services to the farmers on a payment basis or free of cost as per the business model of agripreneur, local needs, and affordability of target group of farmers
• To support agricultural development.
• To create gainful self-employment opportunities for unemployed agricultural graduates, agricultural diploma holders, and intermediate in agriculture and biological science graduates with Post Graduation in agri-related courses.

The correct option is option (1 ) i.e 1969.

• This scheme was launched to provide a lead role to the bank (both private and public) for providing financial assistance to a particular District allotted to the bank.
• The scheme was launched by the RBI on the recommendations of Gadgil Study Group and Nariman Committee.
• Committee and Group found that in rural areas banking services were not having an adequate presence so to overcome this drawback Lead Bank Scheme was launched.
• In 2009, Government of India formed a committee headed by Mrs Usha Thorat, former Deputy Governor of the RBI, to suggest reforms in the LBS.
• State Level Banker's Committee was formed in all the states and a quarterly meeting is held to review the steps taken to increase financial inclusion.

• CRA is an organisation that defines the creditworthiness of an individual, organisation or countries and these are regulated by SEBI(Securities and Exchange Board of India). Different credit rating agencie use different methods to evaluate the credit score with the highest score as AAA and lowest as C/D.
• Standard and Poors, Fitch and Moody's are the big three credit rating agencies.
• SIDBI(Small industrial Development Bank of India)-It is a developmental bank focusing on the MSME (Micro, Small and Medium Enterprise) segment.
• SIDBI HQ- Lucknow
• SIDBI Chairman-  Shri Sivasubramanian Ramann

Deduction on the invested amount up to a maximum limit of Rs 20000/-(Rs twenty thousand).These bonds are issued for the long term of 10 years and more.

The correct answer is 15-year.

In News

• State Bank of India (SBI) on January 18 raised Rs 9,700 crore through its second infrastructure bond issuance.

Key Points

• The issued bonds carry a coupon rate of 7.70% per annum and the tenure of these bonds is 15 years.
• The issue received 118 bids.
• SBI will utilise the proceeds to enhance long-term resources for funding infrastructure and the affordable housing segments, it said in a press release.
• Before this, the bank had raised infrastructure bonds of Rs 10,000 crore on December 6, 2022.
• The bank has an ‘AAA’ credit rating from domestic credit rating agencies for these instruments.
• This latest issuance is very significant considering this is the first time an Indian bank is issuing 15-year long-term infrastructure bonds, helping the bank in long-term lending to the infrastructure segment.

Additional Information

• The State Bank of India descends from the Bank of Calcutta founded in 1806, via the Imperial Bank of India, making it the oldest commercial bank in the Indian subcontinent.
• Founded: 1 July 1955
• Headquarters: Mumbai
• Chairman: Dinesh Kumar Khara
• Tagline: The Banker To Every Indian

The correct answer is 5.0%.

In News

• The Union Minister for Finance & Corporate Affairs Nirmala Sitharaman tabled the Economic Survey 2022-23 in Parliament on January 31.

Key Points

• Economic Survey 2022-2023 points out that the efforts of RBI and the Government in terms of calibrated policy measures like strengthening the regulatory and supervisory framework, implementation of 4R’s approach of Recognition, Resolution, Recapitalization and Reforms have culminated in the enhancement of risk absorption capacity and a healthier banking system balance sheet both in terms of asset quantity and quality over the years.
• The Gross Non-Performing Assets ratio (GNPA) of Scheduled Commercial Banks (SCBs) has decreased from 8.2 per cent in March 2020 to a seven-year low of 5.0 per cent in September 2022.
• “Lower slippages and the reduction in outstanding GNPAs through recoveries, upgrades and write-offs led to this decrease”, the Survey said.
• As per the baseline scenario of the RBI’s stress testing framework, the declining tendency in the GNPA ratio is likely to continue and is projected to drop further to 4.9 per cent in March 2023.
• Moreover, with shrinking GNPAs, the Provisioning Coverage Ratio (PCR) has been increasing steadily since March 2021 and reached 71.6 per cent in September 2022.

Additional Information

• A Non-Performing Asset (NPA) is a loan or advance for which the principal or interest payment remained overdue for a period of 90 days.
• Banks are required to classify NPAs further into:

1. Substandard assets: Assets which has remained NPA for a period less than or equal to12 months.
2. Doubtful assets: An asset would be classified as doubtful if it has remained in the substandard category for a period of 12 months.
3. Loss assets: As per RBI, “Loss asset is considered uncollectible and of such little value that its continuance as a bankable asset is not warranted, although there may be some salvage or recovery value.”

The correct answer is Russia.

Key Points 

• Russia has become India’s top oil supplier in October, surpassing traditional sellers Saudi Arabia and Iraq, according to data from energy cargo tracker Vortexa.

Oil Trade

• The top oil exporter to India in 2020-21 was Iraq followed by Saudi Arabia.
• Iraq’s share in India’s imports increased from about 9% in 2009-10 to over 22% in 2020-21.
• Though Saudi Arabia lost its long-held position as the largest source of India’s oil imports to Iraq in 2017-18.
• Saudi Arabia’s share has remained steady between 17-18% of India’s imports over a decade.
• Import Data From The Top 5 Nations 
• Iraq—867,500 BPD (barrels per day)
• United States—-545,300 BPD—14% of India’s overall imports in FEB 2021
• Nigeria —-472,300 BPD
• Saudi Arabia—-445,200 BPD—Saudi Arabia, which has consistently been one of India’s top two suppliers, slipped to No. 4 for the first time since at least January 2006.
• UAE.

Additional Information

• Interestingly, the USA was not among the top 20 oil exporters to India a decade ago, it was the 18^th largest exporter in 2017-18 and fourth largest in 2020-21. 
• Apart from the fact that crude oil exports from the USA were illegal until 2015, USA was also a large net importer of crude oil.
• With the growth in production of shale oil, the USA is now not only a net exporter of crude oil but also the world’s largest producer.
• The entry of the USA as India’s 4^th largest source of oil imports breaks the trend of Saudi Arabia, Iraq, Iran, Kuwait, the UAE, Nigeria, and Venezuela dominating India’s top five oil import sources for over two decades.
• Russia, the country to come under Western sanctions in 2022, is not a large source of India’s oil imports but it has remained in India’s long portfolio of oil importers for over a decade.
• In 2021-22 (April to January), Russia’s share in India’s oil importers was 2.3%, which put Russia among India’s top 10 sources of oil imports.
• India crude oil imports — data for February 2021

The correct answer is 26%.

Key Points

• RBI has raised the cap on promoter's stake in private banks, to 26 percent from the current 15 percent limit, of the paid-up voting equity share capital of the bank.
• It has accepted 21 out of the 33 recommendations made by the internal working group.
• According to current norms, a promoter of a private bank needs to pare holdings to 20 percent within 10 yrs, and to 15 percent within 15 years.

Important Points

• The promoter can choose to bring down holding to even below 26 percent, any time after the lock-in period of five years.
• The report on the internal working group (IWG) recommendations on private bank ownership and corporate structure was released in November 2021.
• Also, the RBI accepted the proposal that there is no need to fix any cap on the promoters’ holding for the initial five years.
• RBI may also introduce a reporting mechanism for pledging shares by promoters of private sector banks.
• Also, banks currently under NOFHC (non-operative financial holding company) structure may be allowed to exit from such a structure if they do not have other group entities in their fold.
• RBI also accepted that the minimum requirement on the track record of the experience of promoting entity, including for a converting NBFC, may continue at 10 years for Universal Banks and 5 years for Small finance banks (SFB).
• However, for a Payments Bank (PB) intending to convert into an SFB, a track record of 3 years of experience as PB may be sufficient.

Additional Information

• Reserve Bank of India:
• The Reserve Bank of India was established on April 1, 1935, in accordance with the provisions of the Reserve Bank of India Act, 1934.
• The central office of the Reserve Bank of India was initially established in Kolkata but was permanently moved to Mumbai in 1937.
• Reserve Bank of India (RBI) is the Central Bank and supreme monetary authority of India.

The correct answer is 4500 MW.

Key Points

• Ministry of Power kicked off a scheme for procurement of aggregate power of 4500 MW on competitive basis for five years on Finance, Own and Operate basis under B (v) of SHAKTI Policy.
• PFC Consulting Ltd, a wholly owned subsidiary of PFC Ltd has been designated as the Nodal Agency by the Ministry of Power.
• Under the scheme, PFC Consulting Ltd has invited bids for the supply of 4,500 MW.

Important Points

• Supply of electricity will commence from April 2023.
• Ministry of Coal has been requested to allocate around 27 mtpa for this.
• The utilities that have evinced interest for the scheme are Gujarat Urja Vikas Nigam Ltd, Maharashtra State Electricity Distribution Company Ltd, Madhya Pradesh Power Management Company Ltd, New Delhi Municipal Corporation and Tamil Nadu Generation and Distribution Corporation Ltd.
• It is for the first time that bidding is being carried out under B(v) of Shakti scheme.
• SHAKTI stands for Scheme for Harnessing and Allocating Koyala Transparently in India.

The correct answer is 'Rs. 15000'

Key Points

• The Reserve Bank on Thursday raised the Additional Factor of Authentication (AFA) limit from Rs 5,000 to Rs 15,000 per transaction for e-mandates on cards, Prepaid Payment Instruments (PPIs) and UPI for recurring transactions. It implies, additional authentication will not be need for payment of Rs 15,000 per transaction.
• The Reserve Bank of India (RBI) has, over the past decade, put in place various safety and security measures for card payments, including the requirement of AFA, especially for 'card-not-present' transactions.
• Under e-mandate, an individual can give standing instruction to the bank to debit a specific amount automatically on a recurring basis.

The correct answer is 1 and 3 only.

In News

• Government e-Marketplace (GeM) has brought in certain changes to promote ‘Make in India’ and ‘Aatmanirbhar Bharat’.

Key Points

• It is now mandatory for sellers to enter the Country of Origin while registering all new products on GeM. Hence statement 3 is correct.
• Sellers, who had already uploaded their products before the introduction of this new feature on GeM, have to regularly update the Country of Origin.
• There shall be a provision for indication of the percentage of local content in products.
• The ‘Make in India’ filter has now been enabled on the portal. Buyers can choose to buy only those products that meet the minimum 50% local content criteria.

Important Points

• About GeM:
• GeM is a state-of-the-art national public procurement platform of the Ministry of Commerce and Industries, that has used technology to remove entry barriers for bonafide sellers and has created a vibrant e-marketplace with a wide range of goods and services. Hence statement 2 is not correct.
• GeM aims to enhance transparency, efficiency, and speed in public procurement. Hence statement 1 is correct.

The correct answer is 'New Delhi'.

Key Points

• The government has appointed a total of 15 judicial and technical members at the National Company Law Tribunal (NCLT), which is grappling with a shortage of judges.
• The NCLT adjudicates matters related to the Insolvency and Bankruptcy Code (IBC) and companies law.
• As many as 9 judicial members and 6 technical members have been appointed to the NCLT.
• These members have been appointed for a period of five years from the date of taking charge or till they attain the age of 65 years, whichever is earlier.
• The NCLT has a total of 28 benches, with a sanctioned strength of 63 members.
• This includes 31 each from the judicial and administrative sides along with its president, who heads the principal bench in New Delhi.

Additional Information

• The National Company Law Tribunal is a quasi-judicial body in India that adjudicates issues relating to Indian companies.
• The tribunal was established under the Companies Act 2013 and was constituted on 1 June 2016 by the government of India and is based on the recommendation of the V. Balakrishna Eradi committee on law relating to the insolvency and the winding up of companies.
• All proceedings under the Companies Act, including proceedings relating to arbitration, compromise, arrangements, reconstructions and the winding up of companies shall be disposed off by the National Company Law Tribunal.

The correct answer is 2 and 3 only.

In News

• The Finance Ministry said that the incentives paid by the government to banks for promoting RuPay debit cards and low-value BHIM-UPI transactions will not attract GST.

Key Points

• The Cabinet recently cleared a Rs 2,600-crore incentive scheme for banks to promote RuPay debit cards and low-value BHIM-UPI transactions in the current fiscal. Hence, statement 1 is incorrect.
• Under the Incentive scheme for the promotion of RuPay Debit Cards and low-value BHIM-UPI transactions, the government pays banks an incentive as a percentage of the value of RuPay Debit card transactions and low-value BHIM-UPI transactions up to Rs 2,000. Hence, statement 2 is correct.
• The Finance Ministry said that the incentive is in the nature of a subsidy directly linked to the price of the service and the same does not form part of the taxable value of the transaction in view of the provisions of the Central GST Act, 2017. Hence, statement 3 is correct
• The Payments and Settlements Systems Act, 2007 prohibits banks and system providers from charging any amount from a person making or receiving payments through RuPay Debit cards or BHIM.

Additional Information

• The Goods and Services Tax (GST) came into effect from 1 July 2017 through the implementation of the One Hundred and First Amendment of the Constitution of India by the Indian government.
• The GST replaced existing multiple taxes levied by the central and state governments.
• Currently, all services, barring a few specified services such as services of the postal department, transportation, supplied by Central or State Governments, or local authority to any person other than business entities are exempt from GST.

The correct answer is Insolvency and Bankruptcy Board of India Regulations, 2017.

Key Points

• The Insolvency and Bankruptcy Board of India has amended the Insolvency and Bankruptcy Board of India (Grievance and Complaint Handling Procedure) Regulations, 2017 and the Insolvency and Bankruptcy Board of India (Inspection and Investigation) Regulations, 2017.
• The Amendment Regulations are effective from 14^th June 2022.

Additional Information

• ​It was established on 1 October 2016 and given statutory powers through the Insolvency and Bankruptcy Code, which was passed by Lok Sabha on 5 May 2016.
• It attempts to simplify the process of insolvency and bankruptcy proceedings.
• It handles the cases using two tribunals like NCLT (National company law tribunal) and Debt recovery tribunal.
• Dr. Navrang Saini, Dr. Ms. Mukulita Vijayawargiya and Sh. Sudhaker Shukla are currently the Whole Time Members of IBBI.

The correct answer is 'seven'.

Key Points

• State Bank of India (SBI) is planning to raise up to Rs 10,000 crore via infrastructure bonds during the current quarter ending March 2023.
• The country’s largest lender may float a public offering of these bonds or place them privately, the bank said in a filing with the BSE.
• In December 2022, it had raised Rs 10,000 crore through a maiden issue of 10-year infrastructure bonds carrying a coupon of 7.51 per cent.
• The infrastructure bonds are exempt from computation of net demand and time liabilities (NDTL). Therefore, they are not subject to cash reserve ratio (CRR) and statutory liquidity ratio (SLR) requirements.
• Apart from infrastructure projects, the money can also be used for loans to affordable housing ventures.
• Infrastructure bonds are long-term, fully paid, redeemable and unsecured financial instruments. The minimum maturity period for these bonds is seven years.

Additional Information

• State Bank of India (SBI) is an Indian multinational public sector bank and financial services statutory body headquartered in Mumbai, Maharashtra.
• The bank descends from the Bank of Calcutta, founded in 1806 via the Imperial Bank of India, making it the oldest commercial bank in the Indian subcontinent.
• Bank  Tagline: " Pure Banking, Nothing Else"
• SBI Chairman: Dinesh Kumar Khara