Banking Terms — Set 6

Correct Answer: C. Export-Import Bank

• **Export-Import Bank** = EXIM Bank is India's premier export finance institution, established to provide financial assistance to exporters and importers. • **1982** — EXIM Bank was established in this year to support India's international trade. • 💡 Wrong-option analysis: [Expert Investment Management Bank]: An incorrect full form for EXIM. [Exchange and Investment Bank]: Not the official name of the bank. [External-Internal Management Bank]: An incorrect full form; 'EXIM' specifically refers to 'Export-Import'.

Correct Answer: A. Over The Counter Exchange of India

• **Over The Counter Exchange of India** = OTCEI was set up to provide small and medium companies an avenue to raise capital. • **First screen-based exchange** — OTCEI was the first screen-based nationwide stock exchange in India. • 💡 Wrong-option analysis: [Organization of Technical Cooperation and Economic Integration]: Not the correct full form; OTCEI is a stock exchange. [Office of Technical Control and External Investment]: An incorrect and unrelated term. [Official Trade Control and Equity Integration]: Does not represent the nature of OTCEI.

Correct Answer: B. Value Added Tax

• **Value Added Tax** = VAT is an indirect tax that is paid at each stage of the production or distribution of a product or service. • **2017** — VAT was largely replaced by the Goods and Services Tax (GST) in India in this year. • 💡 Wrong-option analysis: [Volume Adjusted Tax]: Not the correct full form for VAT. [Variable Amount Tax]: An incorrect term for this type of taxation. [Virtual Asset Tax]: A modern concept, unrelated to the traditional VAT.

Correct Answer: C. London Interbank Offered Rate

• **London Interbank Offered Rate** = LIBOR was a benchmark interest rate at which global banks lent to one another in the international interbank market. • **Risk-free rates** — Most financial jurisdictions have now transitioned away from LIBOR to other risk-free rates. • 💡 Wrong-option analysis: [Local Investment Board of Revenues]: An incorrect full form for LIBOR. [London International Business of Research]: Not the correct full form. [Legal Investment Bureau of Revenue]: An incorrect and unrelated term.

Correct Answer: B. Fast Moving Consumer Goods

• **Fast Moving Consumer Goods** = FMCG are products that are sold quickly and at a relatively low cost, such as packaged foods and toiletries. • **High consumer demand** — These products have a short shelf life because of high consumer demand. • 💡 Wrong-option analysis: [Fiscal Management of Capital Growth]: Not the correct full form for FMCG. [Foreign Multi-national Corporate Group]: An incorrect and unrelated term. [Financial Markets and Capital Group]: Does not represent the category of FMCG products.

Correct Answer: B. National Stock Exchange

• **National Stock Exchange** = NSE is a leading stock exchange in India, located in Mumbai. • **First electronic trading** — NSE was the first exchange in India to provide modern, fully automated electronic trading. • 💡 Wrong-option analysis: [National Share Exchange]: Not the precise official name. [National Securities Exchange]: While related, 'Stock' is the specific term in NSE. [New Stock Entity]: An incorrect full form for NSE.

Correct Answer: B. Cash Reserve Ratio

• **Cash Reserve Ratio** = CRR is the percentage of liquid cash that banks have to maintain with the central bank of the country. • **Liquidity and inflation** — This tool is used to manage liquidity and control inflation in the economy. • 💡 Wrong-option analysis: [Credit Risk Record]: Not the correct full form for CRR in banking. [Capital Reserve Rating]: An incorrect and unrelated banking term. [Common Reserve Rate]: Not the official or recognized term for CRR.

Correct Answer: A. Society for Worldwide Interbank Financial Telecommunication

• **Society for Worldwide Interbank Financial Telecommunication** = SWIFT is a global messaging network used by banks to securely send and receive financial transaction information. • **11,000+ institutions** — Over 11,000 institutions in 200+ countries use SWIFT for secure interbank communication. • 💡 Wrong-option analysis: [Secure Wire International Fund Transfer]: An incorrect full form, though it relates to fund transfers. [Standard Worldwide Internet Financial Technology]: Not the correct official name. [System for World Integrated Financial Transactions]: An incorrect full form.

Correct Answer: B. Real Time Gross Settlement

• **Real Time Gross Settlement** = RTGS is an electronic fund transfer system where transactions are settled individually and in real time. • **₹2 lakh** — The minimum amount for RTGS transfer is ₹2 lakh, and it is managed by the RBI. • 💡 Wrong-option analysis: [Reserve Transfer General Service]: Not the correct full form for RTGS. [Rapid Transfer Gateway System]: An incorrect full form. [Real Transaction Guarantee System]: Not the official name for this banking service.

Correct Answer: A. National Electronic Funds Transfer

• **National Electronic Funds Transfer** = NEFT processes transactions in batches at fixed intervals, unlike RTGS which settles in real time. • **No minimum amount** — There is no minimum transfer amount for NEFT, making it accessible for smaller transfers. • 💡 Wrong-option analysis: [National E-banking Fund Transfer]: Not the correct official name. [New Electronic Financial Technology]: An incorrect full form. [Net Exchange Fund Transaction]: Does not represent the accurate nature of NEFT.