1
The Reserve Bank of India was established on:
Correct answer: B. 1 April 1935
The RBI began operations on 1 April 1935 under the Reserve Bank of India Act, 1934.
easy
RBI, Banking and Money MCQs
Solved MCQs on the Reserve Bank of India, monetary policy terms (repo, reverse repo, CRR, SLR), bank nationalisation, NABARD, SEBI, UPI and other banking basics.
20 MCQsUpdated 27 October 2026
This set covers the Reserve Bank of India and its tools of monetary policy, including the repo and reverse repo rates and the Monetary Policy Committee, along with the history of bank nationalisation and common banking terms such as KYC.
Remember the direction of each policy rate: the repo rate is what the RBI charges banks, and the reverse repo rate is what it pays them. Many questions turn on that single difference.
- 2
The Reserve Bank of India was nationalised in:
Correct answer: C. 1949
The RBI was set up as a private shareholders' bank and became fully owned by the government on 1 January 1949.
medium - 3
The central office of the Reserve Bank of India is in:
Correct answer: D. Mumbai
The central office moved from Calcutta to Bombay (Mumbai) in 1937.
easy - 4
The repo rate is the rate at which:
Correct answer: A. the RBI lends short-term funds to commercial banks against government securities
When the RBI raises the repo rate, borrowing becomes costlier for banks, which tends to slow down lending and inflation.
Read detailseasy - 5
The reverse repo rate is the rate at which:
Correct answer: B. the RBI borrows money from commercial banks
It is the rate the RBI pays banks for parking their surplus funds with it, the opposite of the repo rate.
easy - 6
The Cash Reserve Ratio (CRR) is the share of a bank's deposits that it must:
Correct answer: A. keep as cash with the RBI
CRR money is kept with the RBI and earns no interest; raising it reduces the money banks can lend.
easy - 7
The Statutory Liquidity Ratio (SLR) requires banks to keep a share of their deposits in:
Correct answer: D. liquid assets such as cash, gold and approved government securities
Unlike CRR, SLR assets are held by the banks themselves.
medium - 8
The one-rupee note in India is signed by the:
Correct answer: C. Finance Secretary
The one-rupee note is issued by the Government of India and signed by the Finance Secretary; other notes carry the RBI Governor's signature.
Read detailsmedium - 9
Fourteen major commercial banks were nationalised on:
Correct answer: C. 19 July 1969
Fourteen banks were nationalised on 19 July 1969; six more followed on 15 April 1980.
medium - 10
NABARD, set up in 1982, mainly finances:
Correct answer: D. agriculture and rural development
The National Bank for Agriculture and Rural Development is the apex body for rural credit.
easy - 11
SEBI is the regulator of:
Correct answer: A. the securities (stock) market
The Securities and Exchange Board of India regulates stock exchanges, brokers and mutual funds. Insurance is regulated by IRDAI.
Read detailseasy - 12
Under the flexible inflation-targeting framework, the RBI targets inflation measured by the:
Correct answer: B. Consumer Price Index (combined)
The target is CPI (combined) inflation of 4%, with a tolerance band of 2% on either side.
medium - 13
How many members are there in the RBI's Monetary Policy Committee?
Correct answer: C. 6
The MPC has six members: three from the RBI, including the Governor who chairs it, and three external members appointed by the government.
Read detailsmedium - 14
The rupee symbol (₹) was designed by:
Correct answer: A. D. Udaya Kumar
D. Udaya Kumar's design was chosen in 2010; it blends the Devanagari "Ra" and the Roman "R".
medium - 15
The Unified Payments Interface (UPI) was developed by:
Correct answer: B. the National Payments Corporation of India (NPCI)
NPCI, an organisation promoted by the RBI and the Indian Banks' Association, launched UPI in 2016.
easy - 16
The largest public sector bank in India is the:
Correct answer: B. State Bank of India
SBI, which grew out of the Imperial Bank of India, is the largest bank in India by assets and branches.
easy - 17
In banking, KYC stands for:
Correct answer: C. Know Your Customer
KYC is the process by which banks verify a customer's identity and address.
easy - 18
Inflation means:
Correct answer: A. a sustained rise in the general price level
During inflation each rupee buys less than before. A fall in the general price level is deflation.
easy - 19
Which body issues currency notes in India (other than the one-rupee note)?
Correct answer: C. Reserve Bank of India
Under Section 22 of the RBI Act, the RBI has the sole right to issue bank notes.
easy - 20
Which is the oldest stock exchange in Asia?
Correct answer: D. Bombay Stock Exchange
The BSE traces its origin to 1875 and is regarded as Asia's oldest stock exchange; the NSE began in 1992.
medium