Module III Banking Theory and Practice

What is the primary aim of retail banking?

• To manage corporate accounts

• To handle international trade

• To meet the everyday financial needs of individuals

• To manage government finances

Which type of deposit account allows unlimited transactions but offers no interest?

• Savings Account

• Current Account

• Fixed Deposit

• Recurring Deposit

What is the typical tenure range for Fixed Deposits (FDs)?

• 3 months to 2 years

• 7 days to 10 years

• 1 year to 5 years

• 6 months to 3 years

What feature is common to recurring deposits (RDs)?

• Interest rates are variable

• Fixed amount invested monthly

• No fixed tenure

• Higher liquidity than savings accounts

What distinguishes time deposits from demand deposits?

• Time deposits offer higher liquidity

• Demand deposits require a fixed tenure

• Time deposits require a fixed period of investment

• Demand deposits earn higher interest

Which loan product requires no collateral ?

• Secured loans

• Unsystematic Loan

• unsecured Loan

• Systematic Loan

What is a key feature of education loans?

• High-interest rates

• No repayment period

• Repayment begins after course completion

• No tax benefits

Which facility allows a customer to withdraw more than the account balance?

• Personal Loan

• Credit Card

• Overdraft Facility

• Mortgage

Which payment system is used for high-value real-time transactions?

• NEFT

• IMPS

• RTGS

• UPI

What is a negotiable instrument?

• A fixed-term investment

• A transferable document guaranteeing payment

• A foreign exchange service

• A type of tax exemption