20 descriptive Q&A (150 words each) on the objectives and functions of SEBI, NABARD, and RBI Exam, covering aspects of finance, management, and accounting:
1. What is the primary objective of SEBI in the Indian financial system?
The Securities and Exchange Board of India (SEBI) aims to protect investors’ interests and ensure the smooth functioning of the securities market. Established in 1992, its core objective is to regulate the capital market and instill confidence among investors. SEBI formulates guidelines for stock exchanges, brokers, underwriters, and other intermediaries to promote transparency and accountability. It strives to prevent malpractices such as insider trading, price rigging, and fraudulent financial disclosures. SEBI’s proactive approach to investor education and grievance redressal has played a crucial role in modernizing India’s financial markets. It also fosters healthy competition among intermediaries while ensuring ethical conduct. Overall, SEBI acts as a watchdog that balances the interests of issuers, investors, and market intermediaries, thereby contributing to an efficient and fair securities market.
2. Describe the functions of SEBI related to investor protection.
SEBI plays a pivotal role in protecting investors by ensuring transparency and fairness in the securities market. One of its core functions is to regulate and monitor the activities of stock exchanges, brokers, and merchant bankers. It mandates accurate and timely disclosure of financial information by listed companies, helping investors make informed decisions. SEBI investigates market irregularities like insider trading, pump-and-dump schemes, and price manipulation to safeguard retail investors. It also enforces strict penalties and legal actions against violators. Another vital function is investor education through workshops, online portals, and awareness campaigns. SEBI has established an investor grievance redressal mechanism (SCORES) where complaints can be lodged easily. Through these initiatives, SEBI ensures that small investors are not exploited and fosters trust in the capital market. Its regulatory oversight promotes a level playing field that is crucial for the sustainable growth of financial markets in India.
3. How does SEBI regulate mutual funds and asset management companies?
SEBI regulates mutual funds and Asset Management Companies (AMCs) to ensure investor safety and market integrity. It mandates all mutual funds to be registered with SEBI and follow its guidelines regarding disclosures, asset allocation, risk management, and advertisement norms. SEBI also ensures that fund managers maintain fiduciary responsibilities and invest according to the stated investment objectives in the scheme documents. To prevent misrepresentation, it scrutinizes the content of mutual fund advertisements and requires disclosure of performance metrics in a standardized format. Moreover, SEBI mandates periodic disclosure of portfolio holdings, net asset values (NAVs), and performance returns. It monitors fund operations for compliance with investment limits and diversification norms to prevent concentration risk. In case of violations, SEBI has the authority to impose penalties or suspend licenses. By regulating mutual funds, SEBI helps build investor confidence, encourages long-term savings, and supports the development of the Indian capital market.
4. What is the role of NABARD in rural credit and development?
The National Bank for Agriculture and Rural Development (NABARD) plays a crucial role in facilitating rural credit and promoting sustainable rural development in India. Established in 1982, NABARD serves as an apex institution for financing and supporting institutions engaged in agriculture and rural development. It provides refinancing facilities to cooperative banks, regional rural banks (RRBs), and other financial institutions for lending to farmers, artisans, and rural entrepreneurs. NABARD also implements schemes related to microfinance, watershed development, skill development, and rural infrastructure. Through the Rural Infrastructure Development Fund (RIDF), it finances roads, bridges, irrigation, and health centers in rural areas. Additionally, NABARD supports Self Help Groups (SHGs) and Farmer Producer Organizations (FPOs) to improve rural livelihoods. By integrating finance with development, NABARD promotes inclusive growth and empowers the rural population. Its efforts are instrumental in bridging the rural-urban divide and achieving broader national development goals. NABARD AND RBI EXAM
5. Explain the financial functions of NABARD in the Indian economy.
NABARD’s financial functions are centered on promoting sustainable agriculture and rural development through targeted credit support. It refinances eligible institutions like cooperative banks and Regional Rural Banks (RRBs) to enable them to extend credit to farmers, rural artisans, and small entrepreneurs. NABARD provides short-term, medium-term, and long-term refinancing based on the nature of agricultural activity. It also offers direct credit for specific projects through government-sponsored programs. One of NABARD’s notable financial instruments is the Rural Infrastructure Development Fund (RIDF), which provides low-cost loans to state governments for infrastructure development in rural areas. Additionally, NABARD facilitates financial inclusion by supporting the expansion of banking services in unbanked and underbanked regions. It promotes self-help groups (SHGs) and microfinance institutions by providing capacity-building support and refinance. NABARD’s financial functions align with national priorities such as poverty alleviation, employment generation, and boosting agricultural productivity
6. How does NABARD support microfinance and Self Help Groups (SHGs)?
NABARD is a key driver of microfinance in India and plays a critical role in promoting Self Help Groups (SHGs) through its SHG-Bank Linkage Programme. It provides refinancing to banks that lend to SHGs, enabling access to affordable credit for marginalized communities, especially rural women. NABARD also offers capacity-building support and training to SHGs to enhance their financial literacy and entrepreneurship skills. It helps SHGs transition into micro-enterprises by linking them with markets and providing guidance on value addition. Through its e-Shakti platform, NABARD promotes digitization of SHG records, which enhances transparency and access to formal credit. The organization encourages financial inclusion by facilitating partnerships between NGOs, banks, and government departments. NABARD’s holistic support enables SHGs to become self-reliant and contribute to rural development. By promoting microfinance, NABARD plays a vital role in poverty alleviation, women empowerment, and inclusive economic growth.
7. What are the key objectives of the Reserve Bank of India (RBI)?
The Reserve Bank of India (RBI), established in 1935, is the central bank of India and plays a vital role in maintaining the country’s economic stability. Its primary objectives include regulating the issuance and circulation of currency, maintaining price stability, and ensuring adequate credit flow to productive sectors of the economy. RBI formulates and implements monetary policy to control inflation and stabilize the economy. It also supervises and regulates commercial banks, non-banking financial companies (NBFCs), and cooperative banks to ensure financial stability. Another key objective is to manage foreign exchange reserves and oversee the foreign exchange market under the FEMA Act. RBI also serves as the banker to the government and provides public debt management services. In addition, it promotes financial inclusion and digital payments through initiatives like UPI and Bharat BillPay. Collectively, these objectives make the RBI central to India’s financial and economic development.
8. Describe the RBI’s role in monetary policy and inflation control.
The Reserve Bank of India (RBI) plays a pivotal role in formulating and implementing monetary policy to ensure price stability and support economic growth. It uses policy instruments like the repo rate, reverse repo rate, cash reserve ratio (CRR), and statutory liquidity ratio (SLR) to regulate the money supply and interest rates. When inflation rises, the RBI increases the repo rate to make borrowing costlier, thereby reducing money circulation. Conversely, to stimulate growth during slowdowns, it reduces rates to encourage borrowing and investment. The Monetary Policy Committee (MPC), constituted by the RBI, meets bi-monthly to review economic indicators and decide on rate adjustments. Inflation targeting is a key mandate of the RBI, with the current target set at 4% (±2%). By maintaining inflation within acceptable limits, RBI ensures the purchasing power of the rupee, stabilizes the economy, and boosts investor and consumer confidence.
9. How does RBI regulate and supervise banks and NBFCs?
The RBI ensures the stability and integrity of the Indian banking system by regulating and supervising banks and Non-Banking Financial Companies (NBFCs). It issues licenses for new banks, sets capital adequacy norms, and conducts inspections to ensure compliance with financial regulations. Through its supervisory framework, RBI monitors the solvency, liquidity, asset quality, and risk management practices of financial institutions. It enforces the Basel III norms for banks to maintain sufficient capital buffers against losses. RBI also oversees mergers, amalgamations, and restructuring of banks to protect depositor interests. For NBFCs, RBI has introduced a scale-based regulatory framework categorizing them based on risk levels to ensure stricter oversight. It also monitors digital lending platforms and introduces cybersecurity norms to protect consumers. The RBI’s prompt corrective action (PCA) framework helps address issues in weak banks early. Overall, RBI’s regulatory oversight safeguards financial stability and ensures public trust in the banking system.
10. Explain the functions of RBI as the custodian of foreign exchange reserves.
The RBI acts as the custodian of India’s foreign exchange reserves and manages the country’s external financial stability. It regulates foreign exchange transactions under the Foreign Exchange Management Act (FEMA), 1999. The RBI’s main functions in this role include monitoring the exchange rate of the Indian Rupee against foreign currencies, ensuring adequate forex reserves to meet external liabilities, and intervening in the forex market to prevent excessive volatility. The central bank maintains reserves in the form of foreign currencies, gold, and Special Drawing Rights (SDRs) from the International Monetary Fund (IMF). These reserves are crucial for managing trade deficits, repaying external debt, and maintaining investor confidence. RBI also authorizes and supervises Authorized Dealers (ADs) in foreign exchange to ensure compliance with exchange control norms. By managing reserves prudently, RBI safeguards India’s external economic position and supports seamless international trade and capital flows.
11. What is the significance of SEBI’s role in corporate governance?
SEBI plays a key role in promoting corporate governance by ensuring transparency, accountability, and ethical conduct among listed companies. It mandates timely disclosure of financial statements, related-party transactions, and board decisions, allowing shareholders to make informed decisions. SEBI’s Listing Obligations and Disclosure Requirements (LODR) regulations ensure companies adhere to governance standards, such as having independent directors, audit committees, and whistle-blower mechanisms. It also requires companies to disclose voting results, board evaluation processes, and executive remuneration. SEBI’s oversight helps prevent corporate frauds like insider trading and accounting manipulation. By enforcing governance norms, SEBI protects minority shareholders’ interests and builds investor confidence. Effective corporate governance not only enhances a company’s reputation but also improves its access to capital. SEBI’s proactive enforcement fosters trust in India’s financial markets and aligns businesses with global standards, making Indian companies more attractive to foreign institutional investors (FIIs) and global partners.
12. How does NABARD promote sustainable agricultural development?
NABARD is instrumental in promoting sustainable agriculture through financial, technical, and policy support. It funds projects that encourage eco-friendly farming methods such as organic farming, integrated pest management, agroforestry, and conservation agriculture. NABARD also supports watershed development programs that focus on soil conservation and water management in rain-fed areas. It promotes the use of micro-irrigation techniques like drip and sprinkler systems to ensure water efficiency. Through refinance and direct lending, NABARD enables farmers to adopt modern technologies, solar-powered irrigation, and mechanized equipment that reduce environmental impact. It collaborates with NGOs, research institutions, and government bodies to implement pilot projects and train farmers in sustainable practices. NABARD’s Climate Resilient Agriculture initiatives aim to mitigate the effects of climate change while enhancing productivity and income. Its support fosters environmental sustainability, improves food security, and aligns rural development with the United Nations’ Sustainable Development Goals (SDGs).
13. What are the key management functions performed by RBI?
As the central bank, the RBI performs several critical management functions that ensure financial system stability and economic growth. It manages the country’s monetary policy to control inflation and stimulate economic activity. RBI also manages public debt and acts as a banker to the central and state governments, handling their accounts, borrowing programs, and cash management. It oversees currency issuance and ensures an adequate supply of genuine, clean notes through its currency management function. RBI also maintains the Cash Reserve Ratio (CRR) and Statutory Liquidity Ratio (SLR) to regulate liquidity in the banking system. It manages interest rates, exchange rates, and liquidity operations via open market operations (OMOs). Through its supervisory role, RBI ensures that banks and NBFCs maintain sound financial health, risk management, and corporate governance. These management functions position RBI as a crucial institution for maintaining economic order, policy execution, and trust in the Indian financial ecosystem.
14. How does SEBI regulate Initial Public Offerings (IPOs) and ensure investor safety?
SEBI ensures fair and transparent conduct during Initial Public Offerings (IPOs) by setting strict regulations under the SEBI (Issue of Capital and Disclosure Requirements) Regulations. Companies wishing to raise funds through IPOs must obtain SEBI’s approval and disclose vital information like business risks, financial statements, promoter background, and use of funds in a prospectus. SEBI scrutinizes this prospectus to ensure it is accurate and not misleading. It mandates that merchant bankers, underwriters, and registrars involved in IPOs comply with fair practice norms. The regulator also ensures IPO allotments are transparent by using digital bidding platforms and computerized random selection processes. SEBI keeps a check on overpricing, misstatements, and insider trading during IPOs. Post-issue, companies must disclose financial performance and adhere to governance norms. SEBI’s strong oversight helps protect investors from fraudulent IPOs, fosters market discipline, and boosts investor confidence in capital markets.
15. Explain how NABARD contributes to rural infrastructure development.
NABARD significantly contributes to rural infrastructure development through its flagship Rural Infrastructure Development Fund (RIDF). This fund provides loans to state governments and government-owned corporations for projects like rural roads, irrigation, health centers, drinking water facilities, and storage infrastructure. NABARD identifies critical infrastructure gaps that hinder rural productivity and recommends projects based on ground-level needs. It prioritizes investments in backward and tribal areas to promote equitable development. Apart from funding, NABARD also assists in project planning, execution monitoring, and impact assessment to ensure effectiveness and accountability. Through partnerships with Panchayati Raj institutions and NGOs, it enhances grassroots-level governance in infrastructure management. NABARD also supports solar energy, rural electrification, and digital infrastructure projects, aligning with the Digital India and Green Energy initiatives. By improving physical and social infrastructure, NABARD enables better market access, service delivery, and livelihood generation in rural areas, contributing to inclusive and sustainable rural growth.
16. What is the role of RBI in promoting financial inclusion?
RBI plays a central role in promoting financial inclusion by expanding access to banking and financial services for the underserved population. It formulates policies that encourage banks to open branches in rural and remote areas, and it mandates the use of Basic Savings Bank Deposit Accounts (BSBDAs) with zero balance. RBI supports the Business Correspondent (BC) model to provide doorstep banking in unbanked villages. It also promotes financial literacy through educational campaigns and collaborates with banks, NGOs, and government bodies. RBI’s policies have led to initiatives like Pradhan Mantri Jan Dhan Yojana (PMJDY), which has brought millions into the formal banking fold. Furthermore, RBI encourages innovation through digital payment systems like UPI, AEPS, and Bharat QR to serve customers without requiring physical infrastructure. By ensuring inclusive access to credit, savings, insurance, and pensions, RBI strengthens economic participation and supports equitable growth across various segments of society.
17. How does SEBI support financial market development in India?
SEBI plays a vital role in the development of India’s financial markets by ensuring transparency, innovation, and investor confidence. It introduces and regulates market instruments such as derivatives, REITs, InvITs, and green bonds to broaden investment options. SEBI also strengthens the trading infrastructure by overseeing stock exchanges and depositories to ensure smooth and secure operations. It fosters technological advancement through algorithmic trading, online KYC systems, and e-voting platforms for shareholders. By encouraging robust disclosure norms and corporate governance standards, SEBI ensures companies maintain investor trust and global competitiveness. It also supports start-ups and small businesses by streamlining the SME IPO process and launching new platforms like Innovators Growth Platform (IGP). SEBI regularly consults stakeholders and updates regulations to meet evolving market needs. Through these proactive efforts, SEBI enhances market efficiency, deepens capital formation, and aligns India’s financial system with global best practices.
18. What are NABARD’s initiatives in supporting Farmer Producer Organizations (FPOs)?
NABARD actively supports the formation and development of Farmer Producer Organizations (FPOs) to empower small and marginal farmers. It provides financial assistance for promoting and nurturing FPOs through grants and working capital support. NABARD also funds the capacity building of farmers and FPO leaders through training in governance, marketing, accounting, and value chain management. The Producer Organization Development Fund (PODF) was launched to facilitate long-term handholding and mentorship. NABARD assists in linking FPOs with banks, markets, and input suppliers to improve their bargaining power and income. By aggregating produce and reducing input costs, FPOs enhance economies of scale and access to modern technologies. NABARD also supports innovation in agri-processing, warehousing, and logistics under the FPO model. These efforts empower farmers to become entrepreneurs, reduce exploitation by intermediaries, and foster rural entrepreneurship. FPOs promoted by NABARD play a crucial role in transforming agriculture into a more profitable and sustainable enterprise.
19. How does RBI contribute to digital payment systems and cashless economy?
RBI has been a key driver in promoting digital payments and enabling India’s transition towards a cashless economy. It regulates and facilitates platforms like UPI, NEFT, RTGS, and IMPS, ensuring their interoperability and security. RBI established the Payment and Settlement Systems Act, 2007, and created the National Payments Corporation of India (NPCI) to manage digital infrastructure. It fosters innovation by authorizing new fintech models like Prepaid Payment Instruments (PPIs), digital wallets, and QR-based payments. RBI also mandates banks and payment service providers to follow strict cybersecurity and customer grievance redressal protocols. It promotes financial literacy around digital transactions and sets up grievance redressal mechanisms for digital payment users. RBI’s push for a Digital Rupee (CBDC) reflects its commitment to technological transformation in finance. By increasing accessibility, speed, and cost-effectiveness of payments, RBI significantly enhances convenience, transparency, and accountability in economic transactions across India.
20. What is SEBI’s role in accounting and financial reporting by listed companies?
SEBI plays a regulatory role in ensuring that listed companies maintain accurate and transparent accounting and financial reporting practices. It mandates compliance with Indian Accounting Standards (Ind-AS) and requires companies to submit audited quarterly and annual financial results. SEBI oversees the role of auditors and mandates disclosures on key audit matters, related-party transactions, and risk factors in annual reports. It requires prompt reporting of material events, mergers, acquisitions, and corporate actions under the SEBI (LODR) Regulations. SEBI collaborates with the Institute of Chartered Accountants of India (ICAI) to ensure high-quality financial disclosures. It also enforces penalties for misstatements or fraudulent accounting practices. The regulator mandates XBRL (eXtensible Business Reporting Language) format for easy data analysis by stakeholders. By ensuring reliable and comparable financial reporting, SEBI helps protect investors, boosts capital market efficiency, and aligns Indian markets with global accounting norms and investor expectations.
MCQ
🔍 SEBI (Q1–Q17)
1. What is the primary objective of SEBI?
A) Tax collection
B) Monetary policy
C) Investor protection and market regulation
D) Foreign exchange control
✅ Answer: C
2. SEBI was established in the year:
A) 1982
B) 1992
C) 1988
D) 2000
✅ Answer: B
3. SEBI regulates which of the following?
A) RBI
B) Mutual Funds
C) Ministry of Finance
D) NABARD
✅ Answer: B
4. SEBI’s mechanism for resolving investor complaints is called:
A) IRDA
B) SCORES
C) RIDF
D) CRISIL
✅ Answer: B
5. SEBI is headquartered in:
A) New Delhi
B) Mumbai
C) Chennai
D) Kolkata
✅ Answer: B
6. SEBI ensures transparency in the IPO process by regulating:
A) Dividend distribution
B) Merchant bankers and prospectus disclosure
C) Tax exemptions
D) FDI inflow
✅ Answer: B
7. SEBI regulates the securities market under which Act?
A) Companies Act, 1956
B) Banking Regulation Act, 1949
C) SEBI Act, 1992
D) FEMA Act, 1999
✅ Answer: C
8. Which of the following is not a function of SEBI?
A) Regulating stock exchanges
B) Issuing currency
C) Protecting investor interests
D) Preventing insider trading
✅ Answer: B
9. SEBI regulates mutual fund operations through:
A) NBFC Guidelines
B) ICDR Regulations
C) Banking Guidelines
D) Foreign Exchange Management Rules
✅ Answer: B
10. What is one of SEBI’s key corporate governance requirements?
A) One-time audit
B) No board evaluations
C) Appointment of independent directors
D) Quarterly tax return
✅ Answer: C
11. Which financial body regulates insider trading in India?
A) RBI
B) NABARD
C) SEBI
D) CBDT
✅ Answer: C
12. Which platform was introduced by SEBI to digitize grievance redressal?
A) FinDash
B) ASBA
C) SCORES
D) BharatQR
✅ Answer: C
13. SEBI’s LODR regulation deals with:
A) Debt management
B) Accounting rules
C) Listing Obligations and Disclosure Requirements
D) Microfinance regulation
✅ Answer: C
14. Innovators Growth Platform (IGP) is a SEBI initiative for:
A) SMEs and startups
B) Mutual funds
C) Foreign banks
D) Cooperative societies
✅ Answer: A
15. SEBI collaborates with which institute to ensure accounting quality?
A) NITI Aayog
B) RBI
C) ICAI
D) AIIMS
✅ Answer: C
16. SEBI uses which format for digital financial reporting?
A) CSV
B) XLS
C) XML
D) XBRL
✅ Answer: D
17. REITs and InvITs regulated by SEBI primarily involve:
A) Real estate and infrastructure investments
B) Life insurance
C) Bank mergers
D) Digital currencies
✅ Answer: A
🌱 NABARD (Q18–Q33)
18. NABARD was established in:
A) 1991
B) 1982
C) 2000
D) 1975
✅ Answer: B
19. NABARD mainly focuses on:
A) Urban development
B) Export finance
C) Rural and agricultural development
D) Stock market reforms
✅ Answer: C
20. What is the full form of RIDF managed by NABARD?
A) Rural India Development Fund
B) Rural Infrastructure Development Fund
C) Rural Industrial Development Fund
D) Regional Infrastructure Development Fund
✅ Answer: B
21. NABARD refinances:
A) Scheduled commercial banks only
B) Cooperative banks and RRBs
C) RBI
D) LIC
✅ Answer: B
22. NABARD promotes SHGs under which program?
A) Swachh Bharat Abhiyan
B) PM-Kisan
C) SHG-Bank Linkage Program
D) PM Jan Dhan Yojana
✅ Answer: C
23. NABARD’s e-Shakti initiative deals with:
A) Fertilizer distribution
B) SHG digitization
C) Farmer insurance
D) Kisan Credit Cards
✅ Answer: B
24. NABARD plays a role in supporting:
A) Mutual funds
B) MSMEs in urban cities
C) FPOs – Farmer Producer Organizations
D) Stock brokers
✅ Answer: C
25. Which fund was set up by NABARD to support climate-resilient agriculture?
A) Green India Fund
B) Climate Innovation Fund
C) Adaptation and Mitigation Fund
D) None (Indirect support through RIDF and programs)
✅ Answer: D
26. Which of the following is not directly a function of NABARD?
A) Currency issuance
B) Infrastructure financing
C) Agricultural refinance
D) SHG promotion
✅ Answer: A
27. NABARD’s climate-friendly initiatives include:
A) Floodplain mining
B) Promotion of micro-irrigation
C) Plastic-based farming
D) Deforestation
✅ Answer: B
28. PODF stands for:
A) Professional Organization Development Forum
B) Producer Organization Development Fund
C) Public Organization Development Fund
D) Production Output Data Format
✅ Answer: B
29. NABARD operates under the jurisdiction of:
A) RBI
B) SEBI
C) Ministry of Finance
D) Ministry of Agriculture and Farmers Welfare
✅ Answer: D
30. NABARD supports SHG-Bank linkage since:
A) 1992
B) 2001
C) 1989
D) 1996
✅ Answer: A
31. What is one of NABARD’s key goals?
A) Promote FDI
B) Regulate inflation
C) Reduce rural-urban divide
D) Manage stock markets
✅ Answer: C
32. The main source of funding for RIDF is:
A) RBI
B) Government Bonds
C) Shortfall in PSL targets by commercial banks
D) State Budget
✅ Answer: C
33. NABARD contributes to rural skill development through:
A) KYC verification
B) Capacity-building programs
C) FDI clearance
D) Credit risk guarantee
✅ Answer: B
🏦 RBI (Q34–Q50)
34. RBI was established in:
A) 1935
B) 1949
C) 1951
D) 1991
✅ Answer: A
35. Which body formulates monetary policy in India?
A) NITI Aayog
B) SEBI
C) RBI
D) NABARD
✅ Answer: C
36. The Monetary Policy Committee (MPC) targets inflation at:
A) 2%
B) 4% ± 2%
C) 6% ± 1%
D) 3% ± 1%
✅ Answer: B
37. Which tool is used by RBI to manage liquidity?
A) Fiscal deficit
B) Repo rate
C) GDP
D) Direct tax
✅ Answer: B
38. RBI acts as banker to:
A) NABARD
B) State and Central Governments
C) SEBI
D) Stock Exchanges
✅ Answer: B
39. RBI regulates NBFCs under:
A) SEBI Act
B) Companies Act
C) RBI Act, 1934
D) FEMA
✅ Answer: C
40. RBI’s foreign exchange operations are governed by:
A) FERA
B) FEMA
C) SCRA
D) RERA
✅ Answer: B
41. Which entity manages the UPI platform in India?
A) SEBI
B) NABARD
C) NPCI
D) IRDAI
✅ Answer: C
42. What does RBI use to inject liquidity into the economy?
A) Increase CRR
B) Increase repo rate
C) Conduct Open Market Operations (OMO)
D) Hike tax
✅ Answer: C
43. RBI promotes financial inclusion through:
A) Derivatives markets
B) Commodity markets
C) Business Correspondent Model
D) Mutual funds
✅ Answer: C
44. Which of these is a digital currency initiative by RBI?
A) Rupay
B) Paytm
C) Digital Rupee (CBDC)
D) XBRL
✅ Answer: C
45. RBI’s function as “lender of last resort” means:
A) Grants subsidies
B) Issues licenses
C) Helps banks in financial distress
D) Regulates stock exchanges
✅ Answer: C
46. Which of the following is a statutory reserve ratio maintained with RBI?
A) CRR
B) VAT
C) GST
D) FDI
✅ Answer: A
47. RBI ensures clean note policy through:
A) Inflation control
B) Audit of banks
C) Distribution of fake notes
D) Withdrawal and replacement of damaged currency
✅ Answer: D
48. RBI’s role in digital payments includes:
A) Hosting UPI app
B) Authorizing payment systems
C) Running banks
D) Giving tax relief
✅ Answer: B
49. RBI’s supervision of banks includes:
A) Mandating IPOs
B) Checking balance sheets
C) Approving foreign mergers
D) Auditing SEBI
✅ Answer: B
50. Which of these is not a function of RBI?
A) Monetary policy formulation
B) Currency issuance
C) Promoting rural SHGs
D) Managing forex reserves
✅ Answer: C