JAIIB Exam 2025 – IE&IFS Important Questions MCQs Quiz-24

18/03/2025

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JAIIB Exam 2025 IE&IFS Important Questions MCQs Quiz-24

JAIIB Exam Quiz 2025: The JAIIB exam is scheduled for 2025 by IIBF. Here, we are providing JAIIB IE&IFS MCQ-based quizzes on a regular basis. You can attempt the quizzes regularly to prepare for the upcoming JAIIB exam. The quizzes will be provided module-wise and unit-wise. You can attempt the JAIIB IE&IFS quizzes from the links below and improve your preparation by practicing regularly. These quizzes will help you boost your score in the JAIIB exam and guide you to clear the exam on your first attempt.

Q.1 What was the primary objective of establishing the Agriculture Credit Department in the Reserve Bank of India during the pre-independence period?
A) To regulate agricultural commodity prices
B) To promote rural credit and strengthen cooperative institutions
C) To provide direct loans to farmers from the central bank
D) To facilitate foreign investments in the agricultural sector

Q.2 What was the primary objective of the Lead Bank Scheme introduced by the RBI in 1969?
A) To assign specific banks to districts for coordinated credit planning
B) To privatize commercial banks and increase competition
C) To increase foreign direct investment in the banking sector
D) To promote digital banking and cashless transactions

Q 3 Which of the following institutions was established in 1982 to facilitate rural credit and agricultural development in India?
A) Regional Rural Banks (RRBs)
B) Industrial Finance Corporation of India (IFCI
C) Small Industries Development Bank of India (SIDBI)
D) National Bank for Agriculture and Rural Development (NABARD)

Q.4 What was the significance of MYRADA’s initiative in linking Self Help Groups (SHGs) with banks in 1984-85?
A) It introduced government-controlled lending schemes for SHGs.
B) It marked the beginning of the microfinance movement by facilitating banking with micro-institutions controlled by the poor.
C) It led to the nationalization of microfinance institutions in India.
D) It replaced traditional cooperative banks with SHG-led financial institutions

Q.5 What was the significance of the SHG–Bank Linkage Programme launched by NABARD in 1992?
A) It aimed to provide direct government subsidies to Self Help Groups (SHGs).
B) It introduced SHGs as an alternative to the formal banking system.
C) It integrated SHG financing into the banking system, leading to its inclusion in priority sector lending by RBI in 1996.
D) It mandated commercial banks to replace traditional lending with SHG-based financing.

Q.6 What was the key innovation of the Grameen Bank model, pioneered by Professor Muhammad Yunus in 1976?
A) Providing large-scale corporate loans to rural enterprises
B) Offering collateral-free microloans to financially excluded individuals, particularly women
C) Establishing state-controlled rural banks for financial inclusion
D) Replacing traditional banking with digital-only financial services

Q.7 How do Self Help Groups (SHGs) help in reducing transaction costs for both lenders and borrowers?
A) By replacing collateral with group guarantees and enabling banks to deal with a group rather than individuals
B) By eliminating the need for formal banking channels
C) By restricting financial services only to Below Poverty Line (BPL) members
D) By mandating government subsidies for all SHG members

Q.8 Which of the following correctly defines the role of Microfinance Institutions (MFIs) as per NABARD?
A) Providing large-scale commercial loans to corporate entities
B) Offering small financial services and credit mainly to the poor to improve their income and living standards
C) Replacing traditional banking services for all income groups
D) Facilitating foreign investments in rural infrastructure

Q.9 Which category of Microfinance Institutions (MFIs) forms the largest segment in India?
A) Not-for-profit MFIs, including societies and trusts
B) Mutual benefit MFIs, such as State and National Cooperatives
C) For-profit MFIs (NBFC-MFIs), registered under the Companies Act and regulated by RBI
D) Government-backed public sector MFIs

Q.10 According to RBI’s simplified norms for Self Help Groups (SHGs), when is Customer Due Diligence (CDD) required for all members of an SHG?
A) At the time of opening the SHG’s savings bank account
B) Before the SHG can conduct any financial transactions
C) At the time of credit linking of the SHG with the bank
D) Only if the SHG applies for a government subsidy

Q.11 According to NABARD guidelines, what is the typical savings-to-loan ratio for SHGs, and how does it change for matured SHGs?
A) A fixed 1:1 ratio, irrespective of SHG maturity
B) A savings-to-loan ratio varying from 1:1 to 1:4, with higher loans possible for matured SHGs at the bank’s discretion
C) A maximum 1:2 ratio for all SHGs, with no flexibility for matured SHGs
D) SHGs can borrow unlimited amounts without any savings linked restrictions

Q.12 Under which SHG–Bank Linkage Model do banks provide direct financing to SHGs without NGO intervention?
A) Model I: NABARD–Bank–SHG
B) Model II: NABARD–Bank–SHG (with NGO as a facilitating agency)
C) Model III: NABARD–Bank–NGO–SHG (with NGO as a financial intermediary)
D) None of the above, as NGO involvement is mandatory in all models

Q.13 What is a key characteristic of a Joint Liability Group (JLG) in the context of financial inclusion?
A) A group of 10-20 people from different socio-economic backgrounds formed for collateral-based loans
B) A subset of SHG members or other small farmers and entrepreneurs who require higher loan amounts without collateral
C) A government-mandated group exclusively for tenant farmers and sharecroppers
D) A formal banking institution that provides direct loans to rural borrower

Q.14 What was one of the key recommendations of the Y.H. Malegam Committee (2011) to regulate the microfinance sector in India?
A) Eliminating NBFCs from the microfinance sector
B) Imposing an interest rate ceiling and margin cap on microfinance loans
C) Allowing unlimited multiple lending to promote financial inclusion
D) Mandating microfinance institutions (MFIs) to operate only in rural areas

Q.15 What is the primary purpose of the RBI’s “Framework for Microfinance Loans” issued in March 2022?
A) To eliminate microfinance institutions (MFIs) from the financial sector
B) To restrict microfinance lending to rural areas only
C) To nationalize all microfinance institutions under the RBI’s direct control
D) To regulate banks, NBFCs, MFIs, and housing finance companies under a uniform set of guidelines

Q.16 According to the RBI’s “Framework for Microfinance Loans” (2022), what is the maximum annual household income limit for eligibility to receive a microfinance loan?
A) ₹1.00 lakh
B) ₹2.00 lakh
C) ₹3.00 lakh
D) ₹5.00 lakh

Q.17 As per RBI’s Framework for Microfinance Loans (2022), what is the maximum percentage of monthly household income that can be allocated for loan repayment obligations?
A) 40%
B) 45%
C) 50%
D) 55%

Q.18 As per the latest RBI guidelines, what is the minimum percentage of total assets that must be allocated to microfinance loans for an NBFC to qualify as an NBFC-MFI?
A) 50%
B) 60%
C) 70%
D) 75%

Q.19 Which of the following is NOT a key area of adherence under RBI’s Fair Practices Code (FPC) for NBFCs?
A) Loan appraisal and terms and conditions of sanction
B) Use of coercive measures for loan recovery
C) Resolving customer complaints and grievances
D) Avoiding unreasonably high interest rates

Answer:

Q1: B
Q2: A
Q3: D
Q4: B
Q5: C
Q6: B
Q7: A
Q8: B
Q9: C
Q10: C
Q11: B
Q12: A
Q13: B
Q14: B
Q15: D
Q16: C
Q17: C
Q18: D
Q19: B