Banking Awareness plays an important role in the RBI Assistant Mains Examination, which is scheduled for 7th June 2026. Candidates aiming to score high in the General Awareness section should go through important questions based on banking concepts, RBI cicurlars, RBI functions, banking regulatations, monetory policies, and more. 

To help aspirants, we have compiled the Top 40 Banking Awareness Questions for RBI Assistant Exam based on recent exam trends. 

Banking Awareness for RBI Assistant Exam

One of the highest-scoring sections of the RBI Assistant Main exam is General Awareness, which includes Banking Awareness. Questions are generally asked from RBI functions, monetary policy, financial institutions, banking regulations, digital payments, NPA management, Basel norms, priority sector lending, and financial markets. Below, we have provided the top 40 questions and answers for banking awareness for RBI assistant exam, which is scheduled for 7th June 2026. Candidates should go through these questions thoroughly for an effective preparation. 

Banking Awareness for RBI Assistant Exam: Top 40 Questions and Answers

Here are the top 40 questions and answers of Banking Awareness for RBI Assistant Exam:

Q1. Which of the following is the apex monetary authority of India?

(a) SEBI

(b) NABARD

(c) Reserve Bank of India (RBI)

(d) SIDBI

Answer: (c) Reserve Bank of India (RBI)

Explanation: RBI is the central bank of India established in 1935; it issues currency, regulates monetary policy, and acts as banker to the government.

Q2. The Monetary Policy Committee (MPC) of RBI consists of how many members?

(a) 4

(b) 5

(c) 6

(d) 8

Answer: (c) 6

Explanation: MPC has six members — three from the RBI (Governor as Chair, Deputy Governor, and one RBI official) and three external members appointed by the Government.

Q3. What is the minimum capital requirement for setting up a new private sector bank in India as per RBI guidelines?

(a) ₹200 crore

(b) ₹500 crore

(c) ₹1000 crore

(d) ₹2000 crore

Answer: (b) ₹500 crore

Explanation: RBI guidelines for new private sector banks require a minimum initial capital of ₹500 crore.

Q4. Which ratio indicates the percentage of deposits that banks must keep with RBI?

(a) SLR

(b) CRR

(c) Repo Rate

(d) Bank Rate

Answer: (b) CRR

Explanation: Cash Reserve Ratio (CRR) is the share of a bank’s deposits that it must keep as liquid cash with RBI; it controls liquidity.

Q5. SWIFT stands for:

(a) Society for Worldwide Interbank Financial Telecommunication

(b) Secure World Interbank Fund Transfer

(c) System for World Interbank Financial Transaction

(d) Standard World Interbank Finance Transfer

Answer: (a) Society for Worldwide Interbank Financial Telecommunication

Explanation: SWIFT is a global messaging network used by banks to securely transmit instructions via standardised codes.

Q6. What does ‘RTGS’ stand for?

(a) Real Time Gross System

(b) Real Time Gross Settlement

(c) Rapid Transfer Gross Settlement

(d) Real Transfer Gross Settlement

Answer: (b) Real Time Gross Settlement

Explanation: RTGS enables real-time, gross-basis settlement of high-value fund transfers; usually used for large payments.

Q7. The concept of ‘Priority Sector Lending’ in India was first introduced on the recommendation of:

(a) Narasimham Committee

(b) Dr. K.S. Krishnaswamy Committee

(c) Gadgil Study Group

(d) M. Narasimham Working Group

Answer: (c) Gadgil Study Group

Explanation: The Gadgil Study Group (1969) first recommended priority sector lending.

Q8. What is the Statutory Liquidity Ratio (SLR) currently maintained as per RBI norms?

(a) 18%

(b) 18.75%

(c) 19.5%

(d) 20%

Answer: (b) 18.75%

Explanation: SLR is the minimum percentage of deposits maintained as liquid assets (cash, gold, government securities).

Q9. Which of the following is NOT a function of the Reserve Bank of India?

(a) Issuing currency notes

(b) Acting as banker to the government

(c) Granting loans to the public directly

(d) Regulating commercial banks

Answer: (c) Granting loans to the public directly

Explanation: RBI does not lend directly to the public; it lends to banks and the government.

Q10. Under the SARFAESI Act, what does NPA stand for?

(a) Non-Performing Assets

(b) National Priority Account

(c) Non-Profitable Assets

(d) Net Performing Assets

Answer: (a) Non-Performing Assets

Explanation: NPA refers to loans where principal or interest is overdue for 90 days or more; SARFAESI provides recovery mechanisms.

Q11. What is the full form of IMPS in banking?

(a) Immediate Mobile Payment System

(b) Immediate Payment Service

(c) Inter-bank Mobile Payment Service

(d) Instant Money Payment System

Answer: (b) Immediate Payment Service

Explanation: IMPS is an instant interbank electronic fund transfer service operated by NPCI, available 24×7.

Q12. Which institution is known as the ‘Lender of Last Resort’ in India?

(a) SBI

(b) NABARD

(c) Reserve Bank of India

(d) Finance Ministry

Answer: (c) Reserve Bank of India

Explanation: RBI provides emergency funds to banks facing liquidity crises.

Q13. Pradhan Mantri Jan Dhan Yojana (PMJDY) was launched in which year?

(a) 2012

(b) 2013

(c) 2014

(d) 2016

Answer: (c) 2014

Explanation: PMJDY was launched on 28 August 2014 to expand financial inclusion.

Q14. What is the minimum balance required in a Basic Savings Bank Deposit (BSBD) account?

(a) ₹500

(b) ₹1000

(c) ₹250

(d) Zero

Answer: (d) Zero

Explanation: BSBD accounts are zero-balance accounts meant to promote inclusion.

Q15. Which of the following is a Scheduled Commercial Bank?

(a) Primary Agricultural Credit Society

(b) HDFC Bank

(c) District Cooperative Bank

(d) State Cooperative Bank

Answer: (b) HDFC Bank

Explanation: Scheduled commercial banks are included in the Second Schedule of the RBI Act.

Q16. What is the repo rate used for?

(a) Rate at which RBI borrows from commercial banks

(b) Rate at which commercial banks borrow from RBI

(c) Rate for interbank lending

(d) Rate of interest on FDs

Answer: (b) Rate at which commercial banks borrow from RBI

Explanation: Repo rate is the rate at which RBI lends to commercial banks to manage liquidity and inflation.

Q17. The Basel III norms are related to:

(a) Insurance regulation

(b) Capital adequacy for banks

(c) Foreign exchange management

(d) Securities market regulation

Answer: (b) Capital adequacy for banks

Explanation: Basel III is a global regulatory framework for bank capital adequacy and liquidity risk.

Q18. Small Finance Banks are required to lend what percentage of their Adjusted Net Bank Credit (ANBC) to priority sector?

(a) 40%

(b) 60%

(c) 75%

(d) 80%

Answer: (c) 75%

Explanation: Small Finance Banks must lend 75% of ANBC to the priority sector.

Q19. Which of the following is the regulator of insurance companies in India?

(a) SEBI

(b) IRDAI

(c) PFRDA

(d) RBI

Answer: (b) IRDAI

Explanation: IRDAI regulates insurance industry operations.

Q20. Know Your Customer (KYC) norms were introduced to prevent:

(a) Tax evasion only

(b) Money laundering and financial fraud

(c) Credit card fraud only

(d) Cybercrime only

Answer: (b) Money laundering and financial fraud

Explanation: KYC verifies identity and address to prevent money laundering, terror financing and fraud.

Q21. NACH stands for:

(a) National Automated Clearing House

(b) National Account Credit House

(c) New Automated Clearing Hub

(d) National Access Credit Hub

Answer: (a) National Automated Clearing House

Explanation: NACH is a centralised payment system for bulk payments like salaries and pensions.

Q22. The headquarters of the Asian Development Bank (ADB) is located in:

(a) Tokyo, Japan

(b) Bangkok, Thailand

(c) Manila, Philippines

(d) Singapore

Answer: (c) Manila, Philippines

Explanation: ADB is headquartered in Metro Manila, Philippines.

Q23. What is the purpose of the Credit Information Bureau India Limited (CIBIL)?

(a) Providing crop insurance

(b) Maintaining credit history of borrowers

(c) Granting micro-finance loans

(d) Regulating cooperative banks

Answer: (b) Maintaining credit history of borrowers

Explanation: CIBIL collects credit records and generates credit scores for lenders.

Q24. Which act governs the regulation of foreign exchange transactions in India?

(a) FEMA, 1999

(b) FERA, 1973

(c) SEBI Act, 1992

(d) IBC, 2016

Answer: (a) FEMA, 1999

Explanation: FEMA governs foreign exchange transactions in India.

Q25. The ‘Insolvency and Bankruptcy Code (IBC)’ was enacted in which year?

(a) 2014

(b) 2015

(c) 2016

(d) 2018

Answer: (c) 2016

Explanation: IBC was enacted in 2016 for insolvency resolution.

Q26. RBI’s ‘Prompt Corrective Action (PCA)’ framework is triggered when a bank:

(a) Exceeds lending limits

(b) Falls below minimum capital requirements or has high NPAs

(c) Opens too many branches

(d) Merges with another bank

Answer: (b) Falls below minimum capital requirements or has high NPAs

Explanation: PCA activates when capital adequacy, asset quality, or profitability fall below thresholds.

Q27. Payments Banks in India can accept deposits up to a maximum of:

(a) ₹50,000 per customer

(b) ₹1,00,000 per customer

(c) ₹2,00,000 per customer

(d) ₹5,00,000 per customer

Answer: (c) ₹2,00,000 per customer

Explanation: RBI revised the deposit limit for Payments Banks to ₹2 lakh per customer.

Q28. The first bank established in India was:

(a) Bank of Hindustan

(b) State Bank of India

(c) Punjab National Bank

(d) Imperial Bank of India

Answer: (a) Bank of Hindustan

Explanation: Bank of Hindustan (1770) is considered the first bank established in India.

Q29. What is ‘Moral Suasion’ in banking?

(a) A legal tool to penalise banks

(b) Informal persuasion by RBI to banks to follow certain policies

(c) A credit rating tool

(d) Compulsory reserve maintenance

Answer: (b) Informal persuasion by RBI to banks to follow certain policies

Explanation: Moral suasion is a qualitative tool where RBI appeals to banks without legal force.

Q30. Which government scheme provides pension to unorganised sector workers?

(a) Atal Pension Yojana

(b) PM Jeevan Jyoti Bima Yojana

(c) PM Suraksha Bima Yojana

(d) PMJDY

Answer: (a) Atal Pension Yojana

Explanation: APY provides pension for unorganised sector workers and is administered by PFRDA.

Q31. The term ‘Open Market Operations’ (OMO) refers to:

(a) Opening new bank branches

(b) Buying and selling of government securities by RBI

(c) International trade transactions

(d) Foreign exchange operations

Answer: (b) Buying and selling of government securities by RBI

Explanation: OMO manages liquidity by RBI buying or selling securities in the market.

Q32. NABARD was established in:

(a) 1969

(b) 1975

(c) 1982

(d) 1990

Answer: (c) 1982

Explanation: NABARD was established on 12 July 1982 for agricultural and rural development finance.

Q33. What is the full form of NEFT?

(a) National Electronic Funds Transfer

(b) National Electronic Finance Transfer

(c) Net Electronic Fund Transaction

(d) National Easy Fund Transfer

Answer: (a) National Electronic Funds Transfer

Explanation: NEFT is a nationwide payment system for batch-based one-to-one fund transfers.

Q34. Which of the following is a development bank in India?

(a) SBI

(b) SIDBI

(c) HDFC Bank

(d) Kotak Mahindra Bank

Answer: (b) SIDBI

Explanation: SIDBI is the Small Industries Development Bank of India, focusing on MSME finance.

Q35. The term ‘Bancassurance’ refers to:

(a) Banks providing insurance services

(b) Insurance companies providing banking services

(c) Government insurance for banks

(d) Deposit insurance scheme

Answer: (a) Banks providing insurance services

Explanation: Bancassurance is the sale of insurance products through bank branches.

Q36. What is the full form of PMLA?

(a) Prevention of Money Laundering Act

(b) Prohibition of Monetary Lending Act

(c) Protection of Money and Lending Act

(d) Provision for Money Laundering Authority

Answer: (a) Prevention of Money Laundering Act

Explanation: PMLA 2002 is aimed at preventing money laundering and confiscation of proceeds from it.

Q37. Which bank holds the title of ‘Bankers’ Bank’ in India?

(a) State Bank of India

(b) Reserve Bank of India

(c) Punjab National Bank

(d) Bank of Baroda

Answer: (b) Reserve Bank of India

Explanation: RBI maintains accounts of scheduled banks and provides financial accommodation.

Q38. Which of the following is correct about the Repo Rate and Reverse Repo Rate?

(a) Repo > Reverse Repo

(b) Repo < Reverse Repo

(c) Repo = Reverse Repo

(d) No fixed relationship

Answer: (a) Repo > Reverse Repo

Explanation: Repo rate is usually higher than reverse repo; repo is the rate RBI charges banks, reverse repo is the rate RBI pays banks.

Q39. The credit rating agency NOT based in India is:

(a) CRISIL

(b) ICRA

(c) CARE

(d) Moody’s

Answer: (d) Moody’s

Explanation: Moody’s is a US-based global rating agency.

Q40. RBI Act was enacted in:

(a) 1934

(b) 1935

(c) 1949

(d) 1969

Answer: (a) 1934

Explanation: The RBI Act was enacted in 1934; RBI commenced operations in 1935.

Preparation Tips for Banking Awareness for RBI Assistant Exam

Candidates should keep the following preparation tips in mind to boost their overall score in the General Awareness section of the exam:

1. Read RBI Annual Reports: Understand monetary policy, inflation management, and banking regulations.

2. Follow Banking Current Affairs: Track RBI circulars, bank mergers, and policy updates.

3. Revise Banking Terminology: Focus on definitions and practical applications.

4. Attempt Mock Tests: Practice banking awareness quizzes regularly.

5. Maintain Short Notes: Prepare notes on important schemes, committees, and banking terms.