RRBs & Co-operative — Set 3
Banking · RRB और सहकारी बैंक · Questions 21–30 of 60
Which committee recommended the 'Amalgamation' of RRBs to improve their viability?
Correct Answer: B. Khusro Committee
The A.M. Khusro Committee (Agricultural Credit Review Committee) in 1989 first suggested merging weak RRBs. Later phases of amalgamation were carried out in the 2000s and 2010s. This has significantly reduced the total number of RRBs.
Which organization provides refinance to RRBs and Co-operative banks for rural lending?
Correct Answer: B. NABARD
NABARD provides credit facilities to these institutions to boost rural economic activity. This includes short-term refinance for crops and medium-term for investment. This ensures that these banks do not face liquidity shortages for priority lending.
Under which schedule of the RBI Act 1934 are Regional Rural Banks listed?
Correct Answer: C. Second Schedule
Most RRBs are scheduled banks listed in the Second Schedule of the RBI Act. Being 'scheduled' gives them the right to borrow from the RBI at the bank rate. It also implies a certain level of financial stability and regulatory compliance.
Which of the following is NOT a type of Co-operative Credit Institution in India?
Correct Answer: C. Regional Rural Banks
RRBs are a separate category of banks and are not part of the co-operative credit structure. They are joint ventures between Central, State, and Sponsor banks. Co-operative institutions are member-owned and follow different registration laws.
Urban Co-operative Banks are also known as?
Correct Answer: C. Primary Co-operative Banks
Urban Co-operative Banks (UCBs) are officially referred to as Primary Co-operative Banks. They cater primarily to small businesses, traders, and households in urban and semi-urban areas. Their area of operation is limited compared to commercial banks.
Which of the following is a challenge primarily associated with the Co-operative banking sector?
Correct Answer: D. High level of NPAs and political interference
Co-operative banks often struggle with Non-Performing Assets (NPAs) due to poor recovery and political local influence. Being governed by local committees, they sometimes face governance issues. Improving transparency is a major focus for current reforms.
The concept of 'Unit Banking' is most closely associated with which tier of co-operatives?
Correct Answer: A. PACS
PACS function mostly as single units serving a specific small locality. Unlike commercial banks, they do not have a wide branch network. This local focus allows them to understand the specific needs of village members.
Who acts as the 'Sponsor Bank' for a Regional Rural Bank?
Correct Answer: D. A Public Sector Commercial Bank
The law requires a commercial bank, usually a large public sector bank, to sponsor an RRB. The sponsor bank provides training to staff and initial management support. This mentorship helps the RRB adopt professional banking standards.
The 'Vaidyanathan Committee' is associated with reforms in which sector?
Correct Answer: B. Short-term Rural Co-operatives
The Vaidyanathan Committee (2004) proposed a revival package for the rural co-operative credit structure. It emphasized improving governance and providing financial assistance to clean up balance sheets. Many PACS were reorganized based on these suggestions.
Regional Rural Banks are authorized to perform which of the following tasks?
Correct Answer: D. Granting loans to small farmers and artisans
The core mandate of RRBs is to provide credit and other facilities to small and marginal farmers. They also support agricultural laborers, artisans, and small entrepreneurs in rural areas. This focus is ensured through their high PSL targets.