JAIIB Exam 2025 – IE&IFS Important Questions MCQs Quiz-25

19/03/2025

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JAIIB Exam 2025 IE&IFS Important Questions MCQs Quiz-25

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 According to the amendment of 1997 to the Reserve Bank of India Act, 1934, a Non-Banking Financial Company (NBFC) is defined as:
A) Any financial institution incorporated under the Companies Act, 2013
B) A company engaged exclusively in banking operations regulated by the RBI
C) A non-banking institution which is a company and has as its principal business the receiving of deposits or lending in any manner, as well as other institutions specified by the RBI with Central Government approval
D) Any institution offering financial services, whether banking or non-banking

Q.2 As per Section 45-IA of the RBI Act, a Non-Banking Financial Company (NBFC) can commence or carry on the business of a non-banking financial institution only if it:
A) Has a Certificate of Registration (CoR) from the RBI and net owned funds of at least Rs 2 crores
B) Is registered under the Companies Act, 1956, and operates under the direct supervision of the Finance Ministry
C) Has a license from SEBI and maintains a minimum capital adequacy ratio of 15%
D) Is listed on a recognized stock exchange and has a paid-up capital exceeding Rs 5 crores

Q 3 Which study group recommended that hire purchase and leasing companies could accept deposits up to the extent of their Net Owned Funds, leading to early regulatory measures for NBFCs in India?
A) A. C. Shah Committee (1992)
B) James S. Raj Study Group (1975)
C) Narasimham Committee (1991)
D) Malegam Committee (2011)

Q.4 What was a key outcome of the 1997 amendments to the Reserve Bank of India Act regarding NBFCs?
A) Complete deregulation of the NBFC sector to promote competition
B) Introduction of a regulatory and supervisory structure to protect customer interests and ensure smooth functioning of NBFCs
C) Abolishment of prudential norms for NBFCs to facilitate ease of doing business
D) Restriction of foreign direct investment (FDI) in the NBFC sector

Q.5 Which of the following categories of NBFCs are exempt from RBI registration due to regulation by other supervisory authorities?
A) Venture Capital Funds and Stock Broking Companies regulated by SEBI
B) Nidhi Companies regulated by the RBI
C) Chit Fund Companies regulated by SEBI
D) Housing Finance Companies regulated by the Ministry of Finance

Q.6 Why are certain categories of NBFCs exempted from registering with the RBI?
A) To avoid excessive financial regulations in the Indian economy
B) Because they fall under the regulatory purview of other authorities, preventing dual regulation
C) Due to their insignificant role in the financial system
D) As they do not engage in any form of deposit-taking or lending activities

Q.7 Under the liabilities-based classification of NBFCs, what is a key regulatory requirement imposed specifically on NBFCs-D (deposit-taking NBFCs) that distinguishes them from NBFCs- ND (non-deposit-taking NBFCs)?
A) Exemption from capital adequacy norms and liquidity maintenance
B) Requirement to maintain liquid assets, adhere to capital adequacy norms, and follow exposure restrictions
C) Freedom to invest unlimited amounts in land, buildings, and unquoted shares
D) Exclusion from Assets & Liability Management (ALM) discipline and regulatory reporting

Q.8 Which of the following is NOT a regulatory requirement for Deposit-Taking NBFCs (NBFC-Ds) in India?
A) Only those NBFCs to which the RBI had given a specific authorisation and have an investment grade rating are allowed to accept/hold public deposits to a limit of 1.5 times of its Net Owned Funds.
B) They can accept and renew public deposits for a period ranging from 12 months to 60 months.
C) The deposits they accept are insured, ensuring protection for depositors.
D) They cannot offer gifts, incentives, or any additional benefits to depositors.

Q.9 Which of the following correctly defines an Asset Finance Company (AFC) as per RBI regulations?
A) A company that primarily finances stocks, bonds, and other financial securities.
B) A financial institution whose principal business is financing physical assets that support productive or economic activities, with at least 60% of total assets and income derived from such financing.
C) Any NBFC that provides unsecured personal loans to individuals and small businesses.
D) A company engaged in merchant banking and venture capital financing

Q.10 Which of the following statements is NOT TRUE regarding a Core Investment Company – Non-Deposit Taking – Systemically Important (CIC-ND-SI) NBFC?
A) It must hold at least 90% of its total assets as investments in equity shares, preference shares, debt, or loans in group companies.
B) It actively trades in shares, debt, and loans in group companies to maximize returns.
C) Its asset size must be less than ₹100 crore to qualify as a CIC-ND-SI.
D) It can invest in any company without restrictions, including unrelated businesses

Q.11 Which of the following is NOT a mandatory requirement for a Non-Banking Financial Company (NBFC) to qualify as an Infrastructure Finance Company (IFC)?
A) Deploying at least 75% of its total assets in infrastructure loans.
B) Maintaining a minimum Capital to Risk Weighted Assets Ratio (CRAR) of 15%.
C) Having a minimum net owned funds (NOF) of ₹500 crore.
D) Holding a minimum credit rating of ‘A’ or equivalent

Q.12 Which of the following is NOT a requirement for a Non- Banking Financial Company – Microfinance Institution (NBFCMFI) as per the RBI’s regulatory framework?
A) Maintaining at least 75% of total assets as microfinance loans.
B) Having a minimum Net Owned Funds (NOF) of ₹5 crore (₹2 crore for NBFC-MFIs in the North Eastern Region).
C) Being a deposit-taking NBFC with authorization to accept public deposits.
D) Registering with the Reserve Bank of India under the provisions of the RBI Act, 1934.

Q.13 As per RBI regulations, what is the minimum Capital Adequacy Ratio (CAR) that NBFC-MFIs must maintain?
A) 10% of aggregate risk-weighted assets
B) 12.5% of aggregate risk-weighted assets
C) 15% of aggregate risk-weighted assets
D) 20% of aggregate risk-weighted asset

Q.14 Which of the following is a mandatory requirement for an NBFC to be classified as an NBFC-Factor?
A) At least 50% of its total assets must be in the factoring business, and at least 50% of its gross income must come from factoring.
B) It must accept public deposits and provide long-term loans to businesses.
C) It must have a minimum Net Owned Fund (NOF) of ₹100 crore.
D) It must primarily engage in providing infrastructure financing

Q.15 Which of the following is NOT a requirement for a financial institution to qualify as a Mortgage Guarantee Company (MGC)?
A) At least 90% of its business turnover must come from mortgage guarantee business.
B) At least 90% of its gross income must be from mortgage guarantee business.
C) It must have a minimum Net Owned Fund (NOF) of ₹100 crore at the time of commencement.
D) It must engage in providing unsecured personal loans along with mortgage guarantees

Q.16 Which of the following best describes the concept of Shadow Banking?
A) Banking activities carried out exclusively by governmentowned financial institutions.
B) Credit intermediation by entities and activities partially or fully outside the regular banking system.
C) A system where only NBFCs are allowed to conduct banking operations without RBI regulations.
D) The practice of traditional banks engaging in direct lending without regulatory oversight.

Q.17 As per the RBI’s Scale-Based Regulation (SBR) Framework, which of the following NBFC categories will always remain in the Base Layer?
A) NBFC-D, CIC, IFC, and HFC
B) NBFC-P2P, NBFC-AA, NOFHC, and NBFCs without public funds and customer interface
C) SPD and IDF-NBFC
D) NBFC-MFI, NBFC-Factor, and NBFC-MGC

Answer:

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

For Detailed solution with an explanation watch the below video