[Solved] Digital Banking MCQ [Free PDF] - Objective Question Answer for Digital Banking Quiz - Download Now! (2024)

1. Jehanabad
2. Purnia
3. Muzaffarpur
4. More than one of the above
5. None of the above

The correct answer isJehanabad.

In News

• Jehanabaddistricts of Bihar has become the first 100% digital banking district with the joint effort of the Reserve Bank of India and the Union Finance Ministry.

Key Points

• Digital banking is being promoted in the state to provide the benefit of banking facility to the people of every district, every town and every panchayat.
• In the year 2019, the Central Government and the RBIhad decided to make at least one district in every statewith 100 percent digital banking service. Under this, Jehanabad district was selected in Bihar.
• Jehanabad providesdigital banking services to 99.65 percentaccountof the total active account in the district.
• Arwal hasabout 90.58% of its accounts are linked to digital products, while in Sheikhupura so far 89.18% of accounts are linked to digital products.
• Digital banking product includes,internet banking, debit card, mobile banking, UPIand other similar facilities.

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1. Central Bank Deposit Creation
2. Commercial Bank Deposit Creation
3. Central Bank Disinvestment Committee
4. Central Bank Digital Currency

The correctanswer is Central Bank Digital Currency.

Key PointsCBDC stands for "Central Bank Digital Currency." It refers to a digital form of a country's national currency that is issued and regulated by the central bank. CBDC is distinct from cryptocurrencies like Bitcoin, as it is typically considered a digital representation of a country's official currency and is regulated by the central monetary authority.

The concept of CBDC has gained attention as central banks explore the potential benefits and risks associated with digital currencies. CBDCs aim to combine the efficiency of digital transactions with the stability and regulatory oversight provided by central banks. These digital currencies could coexist with physical cash and traditional forms of money.

Several countries and central banks are actively researching and experimenting with CBDCs, and the development and adoption of these digital currencies may have implications for the future of payments, financial systems, and monetary policy.

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1. Patna
2. Purnia
3. Muzaffarpur
4. Jehanabad

The correct answer isJehanabad.

In News

• Jehanabaddistricts of Bihar has become the first 100% digital banking district with the joint effort of the Reserve Bank of India and the Union Finance Ministry.

Key Points

• Digital banking is being promoted in the state to provide the benefit of banking facility to the people of every district, every town and every panchayat.
• In the year 2019, the Central Government and the RBIhad decided to make at least one district in every statewith 100 percent digital banking service. Under this, Jehanabad district was selected in Bihar.
• Jehanabad providesdigital banking services to 99.65 percentaccountof the total active account in the district.
• Arwal hasabout 90.58% of its accounts are linked to digital products, while in Sheikhupura so far 89.18% of accounts are linked to digital products.
• Digital banking product includes,internet banking, debit card, mobile banking, UPIand other similar facilities.

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1. Smart card
2. Both debit and credit card
3. Debit card
4. Credit card

The correct answer is Debit card.

Key PointsA debit card is a payment card that is linked to a bank account. When you use a debit card, the money is deducted directly from your bank account. Debit cards can be used to make purchases in stores, online, and at ATMs.

Credit cards, on the other hand, are not linked to a bank account. When you use a credit card, you are borrowing money from the credit card company. You must repay the borrowed money, plus interest, over time.

Smart cards can be used for a variety of purposes, including payments, identification, and access control. However, smart cards are not typically used for direct payments from bank accounts.

Therefore, the answer is debit card.

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1. NEFT
2. NET Banking
3. RTGS
4. NECS

The correct answwer is Net Banking.

Key PointsNet banking is a recent e-banking initiative in commercial banks in India.

RTGS (Real Time Gross Settlement) and NEFT (National Electronic Fund Transfer) are both older e-banking initiatives that have been around for many years.
NECS (National Electronic Clearing Service) is a system for clearing and settling low-value transactions, and it is not typically used by individuals for e-banking.
Net banking is a more recent e-banking initiative that allows individuals to perform a wide range of banking transactions online, such as transferring funds, paying bills, and checking account balances. Net banking has become increasingly popular in India in recent years, as more and more people gain access to the internet and smartphones.

Additional InformationHere are some examples of net banking initiatives that have been launched by commercial banks in India in recent years:

Instant account opening: Some commercial banks in India now allow customers to open a bank account online without having to visit a branch.
AI-powered chatbots: Some commercial banks in India are using AI-powered chatbots to provide customer support and help customers with their banking transactions.
Biometric authentication: Some commercial banks in India are using biometric authentication, such as fingerprints and facial recognition, to allow customers to log in to their net banking accounts and perform transactions securely.
Overall, net banking is a recent e-banking initiative in commercial banks in India that is becoming increasingly popular and sophisticated.

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Digital Banking Question 6

1. 15^th August, 2016
2. 31^st October, 2016
3. 26^th January, 2016
4. 30^th December, 2016

Digital Banking Question 6 Detailed Solution

• The BHIM app was launched by Prime Minister Narendra Modi on30thDecember, 2016.
  
• BHIM-
  • BHIM is an acronym for Bharat Interface for Money.
  • It is amobile paymentAppdeveloped by theNational Payments Corporation of India (NPCI), based on theUnified Payments Interface (UPI).
  • It is named afterB. R. Ambedkar.
  • The app is built over theImmediate Payment Service (IMPS)infrastructure and allows the user to instantly transfer money between bank accounts of any two parties.
  • Currently, the app has a transaction limit of Rs 10,000 for a single transaction and a daily limit of Rs 20,000.
  • The app also enforces a limit of 20 transactions per account per bank in a day.
    
• National Payment Corporation of India (NPCI) -
  • Founded – 2008
  • Headquarters – Mumbai, Maharashtra
  • MD and CEO – Dilip Asbe
  • Non- Executive Chairman – Biswamohan Mahapatra
  • Major Services – BHIM, UPI, RuPay, IMPS, BharatQR, Bharat bill payment etc

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Digital Banking Question 7

1. IFSC
2. STP
3. SFMS
4. RTGS

Digital Banking Question 7 Detailed Solution

The correct answer is IFSC.

• IFSCis an alphanumeric code that uniquely identifies a bank-branch participating in the NEFT system.

Key Points

• National Electronic Funds Transfer (NEFT) is a mode of online funds transfer that is introduced by the Reserve Bank of India (RBI).
  • It quickly transfers money between banks throughout India.
  • A bank branch must be NEFTenabled for a customer to be able to transfer the funds to another party.
  • It was started in November 2005, the setup was established and maintained by Institute for Development and Research in Banking Technology.

Additional Information

• IFSC (Indian Financial System Code) is an 11 digit alphanumeric code that is used to identify the bank branch of your account.
• The first 4 characters of the IFSC code represent the name of the bank, the fifth character is 0 and the last 6 numbers define the branch code of the bank.

Important Points

• STP: Segmentation, targeting, and positioning.
• SFMS:Structured Financial Messaging System.
• RTGS:Real-Time Gross Settlement.

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Digital Banking Question 8

1. 4
2. 5
3. 6
4. 7
5. 10

Digital Banking Question 8 Detailed Solution

The correct answer is.7.

Key Points

• Mobile Money Identifier or MMID is a 7 digit number of a bank customer who uses mobile banking.
• This number is used when you try to send or receive money using the IMPS fund transfer method.

Additional Information

• The first four digits in an MMID code taken together is thedistinct ID no. of the bank offering IMPS services.
• Since IMPS is an immediate, real-time, inter-bank fund transfer mechanism that is enabled through electronic means, safety measures such as MMID are required to keep the transactions secure
• Every bank account has only one MMID. This MMID would be unique to the bank account.
• Along with the mobile number, MMID identifies a bank account. Different MMID’s can be linked to the same Mobile Number.
• An MMID can be used only by one bank account. You can’t have the same MMID with two bank accounts.

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Digital Banking Question 9

1. Rajasthan
2. Madhya Pradesh
3. Punjab
4. Uttar Pradesh

Digital Banking Question 9 Detailed Solution

The correct answer is Uttar Pradesh.

Key Points

• Pratham Bank was established in 1975 as the first Regional Rural Bank of India.
• Its Head Office was located in Moradabad, Uttar Pradesh.
• The bank was sponsored by Syndicate Bank and had its operations in 8 districts of Uttar Pradesh.
• The first Regional Rural Bank “Prathama Grameen Bank” was set up on October 2, 1975.
• At present, there are 82 RRBs in India.
• The equity of a regional rural bank is held by the Central Government, the concerned State Government and the Sponsor Bank in the proportion of 50:15:35
• The purpose was to include rural areas into the economic mainstream since around 70% of the Indian population was rural.
• Prathama Bank, with its head office in Moradabad,Uttar Pradeshwas the first RRB.

Additional Information

• In October 1983,the Grameen Bank Project was transformed into an independent bank by government legislation.
• Today Grameen Bank is owned by the rural poor whom it serves. Borrowers of the Bank own 90% of its shares, while the remaining 10% is owned by the government.
• The journey of Vikas Bank which started as a small dream of like-minded friends to the proud moment of being aprestigious cooperative bankis a curious and inspirational one
• A group of social-minded youths of Sindhanur in Raichur district came together to form Vikas Yuvaka Mandali in 1979.

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Digital Banking Question 10

1. Hourly basis
2. Half Hourly Basis
3. Two Hourly Basis
4. Quarterly basis
5. None of these.

Digital Banking Question 10 Detailed Solution

A correct answer is an option(2) i.e Half Hourly Basis.

National Electronic Funds Transfer (NEFT) is a nation-wide centralized payment system owned and operated by the Reserve Bank of India (RBI).Individuals, firms and corporates maintaining accounts with any member bank, participating in the NEFT system, can electronically transfer funds to any individual, firm or corporate having an account with any other bank in the country participating in the NEFT system.

• No charges to savings bank account customers for online NEFT transactions.
• NEFT is done on the half-hourly basis in a day i.e 48 batches in a day.
• IFSC or Indian Financial System Code is an alpha-numeric code that uniquely identifies a bank-branch participating in the NEFT system. It’s an 11-digit code with the first 4 alpha characters representing the bank, and the last 6 characters representing the branch. The 5th character is 0 (zero). IFSC is used by the NEFT system to identify the originating / destination banks/branches and also to route the messages appropriately to the concerned banks/branches.
• With effect from January 01, 2020, banks have been advised to not levy any charges from their savings bank account holders for NEFT funds transfers initiated online.
• There is no minimum and maximum limit of funds transfer from the NEFT.

Note :

• MICR Code- Magnetic ink character recognition(MICR) is a code printed on the cheque which enables identification of the cheques and identifies the bank and branch participating in an Electronic Cheque Clearing system. It is a 9-digit code
• SWIFT Code- Society for Worldwide Interbank Financial Telecommunication Code (SWIFT)is the standard code which is internationally accepted for funds transfer, it is a unique code of a particular bank branch which is a unique internationally and used for the international transaction as well. It consists of 8 or 11 characters.
  • First 4 characters- Bank code(only letters)
  • Next 2 characters- Country code(only letters)
  • Next 2 Characters- Location code(letters and digits)
  • Last 3 characters- Branch code, optional( letters and digits)​

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Digital Banking Question 11

1. National Exchange of Funds Transfer
2. National Electronic Financial Transfer
3. Net Electronic Funds Transfer
4. National Electronic Funds Transfer

Digital Banking Question 11 Detailed Solution

The correct answer is National Electronic Funds Transfer.

Key Points

• NEFT stands for National Electronic Funds Transfer.
  • It is an electronic funds transfer system maintained by the Reserve Bank of India (RBI).
  • It was started in November 2005.
  • The setup was established and maintained by Institute for Development and Research in Banking Technology.
  • The NEFT system is available round the clock throughout the year on all days, i.e., on a 24x7x365 basis. NEFT presently operates in batches at half-hourly intervals throughout the day.
  • There is no limit imposed by the RBI for funds transfer through the NEFT system. However, banks may place amount limits based on their own risk perception with the approval of its Board.

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Digital Banking Question 12

1. a, c and d
2. b and d only
3. a and c only
4. b, c and d

Digital Banking Question 12 Detailed Solution

Digital Payment:A digitalpayment occurs when goods or services are purchased through the use of various electronic mediums. There is no use of cash or cheques in this type of payment method.

10 Types of Digital Payment Methods in India

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Digital Banking Question 13

1. 10
2. 12
3. 20
4. 15
5. 11

Digital Banking Question 13 Detailed Solution

The correct answer is20

• Currently, BHIM is available in 20languages, i.e.,Hindi, English, Tamil, Telugu, Malayalam, Bengali, Odia, Kannada, Gujarati, Marathi, Assamese, Bengali, Bhojpuri, Haryanvi, Marwari, Konkani, Manipuri, Khasi and Mizo.
• Bharat Interface for Money (BHIM) is a mobile payments application based on NPCI’s Unified Payments Interface (UPI) which helps in making simple, easy and quick payment transactions
• One can make instant bank-to-bank payments and Pay and collect money using just Mobile number or Virtual Payment Address (UPI ID).
• BHIM was launched on 30th December 2016 by PM Narendra Modi.
• Through BHIM App, one can't pay more than Rs. 20,000 in a transaction. So if one wants to pay more than Rs. 20,000, one has to pay twice.
• Transaction Limits: Maximum of Rs. 10,000 per transaction and Rs. 20,000 within 24 hours.
• A user can send up to Rs 100,000 per transaction and a maximum of Rs 100,000 per day for one bank account. This limit is available per bank account linked on BHIM.
• There is also a limit to the number of transactions through the BHIM app. The UPI prohibits more than 10 transactions by an account in 24 hours.

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Digital Banking Question 14

1. Rs. 10,000
2. Rs. 15,000
3. Rs. 20,000
4. Rs. 100,000
5. Rs. 50,000

Digital Banking Question 14 Detailed Solution

The correct answer isRs. 100,000.

• Bharat Interface for Money (BHIM) is a mobile payments application based on NPCI’s Unified Payments Interface (UPI) which helps in making simple, easy and quick payment transactions
• One can make instant bank-to-bank payments and Pay and collect money using just Mobile number or Virtual Payment Address (UPI ID).
• BHIM was launched on 30th December 2016 by PM Narendra Modi.
• A user can send up to Rs 100,000 per transaction and a maximum of Rs 100,000 per day for one bank account. This limit is available per bank account linked on BHIM.
• There is also a limit to the number of transactions through the BHIM app. The UPI prohibits more than 10 transactions by an account in 24 hours.

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Digital Banking Question 15

1. ICICI Bank
2. State Bank of India
3. Punjab National Bank
4. HDFC Bank

Digital Banking Question 15 Detailed Solution

The correct answer isICICI Bank.Key Points

• A new digital platform 'Campus Power' for the student ecosystem has been launched byICICI Bank.
• It is launched to assist students who want to pursue higher education in India and abroad.
• The platform caters to the needs of the students, parents and institutes.

Additional Information

• ICICI Bank
  • ICICI in ICICI Bank stands for Industrial Credit and Investment Corporation of India.
  • ICICI was formed in 1955.
  • The objective was to create a development financial institution for providing medium-termand long-term project financing to Indian businesses.
  • Headquarters: Mumbai.

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