IIBF MOCK TEST SET 13

In case of loans secured by mortgage of immovable properties, the limitation

1 period is in relation to mortgaged security.
a) 7 years
b) 10 Years
c) 12 Years
d) 15 Years

In which rate, the rate of interest changes depending upon the market conditions
2 subject to the reset clause, any, in corporated in the loan agreement?
a) Fixed rate
b) Floating rate

Private Limited company should have minimum of members and a maximum of

3 members
a) 2,200
b) 3,300
c) 5,500
d) 10, no limit

4 The effect of NPA is / are

Due to the uncertainity (delay or default) of income flows the banks income could
a) be impacted and volatite
b) Profit margin of the bank goes down
c) Both A and B
d) None of the above

What is the process of educating the borrowers about how to avoid incurring
5 debts that cannot be repaid as also how to manage the debt burden
and repayment commitments in respect of a number debts?
a) Credit Councelling
b) Communication process
c) Recovery process
d) None of the above

Where the debtors are not willing to pay and who intentionally resist or avoid
6 recovery effects the recovery agent has to follow special process of
recovery against the recalcitrant defaulters is called as?
a) Normal recovery process
b) Legal recovery process
c) Difficult recovery process
d) Assets recovery process
7 Which Section provides that complainant can give evidence on affidavit?
a) Section 142
b) Section 143
c) Section 144
d) Section 145

wherein the account will be operated jointly and the money repayable to both
8 jointly or the survivor, if any one of the joint holders is deceased.
a) either or survivot
b) both jointly or survivor
c) former or survivor
d) any two jointly or last survivor

The right to means that an agent can retain the money belonging to the principal,
9 for meeting the following kinds of expenses, and thereafter
remit the balance amount to the principal.
a) Compensate
b) Retainer
c) Remuneration
d) Indemnity

The amount of loan, rate of interest, percentage of margin, rigts of the bankers in
case of default of loan, details of security carged are included in which of te
10 following/
a) Demand Promissory Note
b) Forms
c) Agreement
d) Non of the above

What is te process of exchanging information, ideas and thought etc. between at

11 least two persons in order to create a common understanding?
a) Recovery
b) Communication
c) Listening
d) Addressing

Post disbursement supervision by lenders, particularly in respect of loans up to ,

12 should be constructive with a view to taking care of any 'lender
related genuine difficulty that the borrower may face.
a) Rs.2 Lakhs
b) Rs.3 Lakhs
c) Rs.4 Lakhs
d) Rs.5 Lakhs

A loan or advance of a bank is difined as 'non Performing Asset' (NPA) when it

13 remains overdue or out of order for a period of :
a) 90 days
b) Less than 90 days
c) More than 90 days
d) More than 180 days

14 Interest on savings bank can be paid :

a) on any interval as per banks own approved policy
b) on half yearly intervals onloy
c) on yearlt intervals only
d) on quarterly intervals only

15 Shishu is the product of MUDRA covering loans up to

a) Rs.50,000
b) Rs.1,00,000
c) Rs.1,50,000
d) Rs.2,00,000

When an asset remains in sub - standard category for molre than 12 months it is
16 called
a) Serious sub - standard asset
b) Doubtful asset
c) Loss asset
d) Bad asset

17 Which of the following are primary rights of the bank?

a) Right of General Lien
b) Right of set-off
c) Right of appropriation
d) All of the above

18 The "special crossing" of a cheque means :

a) When it bears the name of a bank between two transverse lines
b) That the cheques it to be credited in the account to payee only
That it has certain conditions which are to be fulfilled before presenting it for
c) payment / collection
d) That it can be paid in cash over counter
 For recovery of agricultural advances, almost every State Government has passed
19 its own recovery Acts on the lines of Talwar Communittee recommendations,
Yet these are similar in contents is an recovery through?
a) Compromise Settlement
b) Local Recovery Act
c) Filling of Suits
d) Deebt Recovery Tribunal

20 The validity of a cheque / draft is :

a) Six months
b) Three months
c) Nine months
d) Twelve months

One person Company must have minimum Director and the Maximum number of
21 Directors can be .
a) 1.15
b) 2.2
c) 5.3
d) 1.5

22 The bank which pays the merchant for the transactions is called as :
a) Issuer bank
b) clearance bank
c) acquiring bank
d) non of the above

The form of DPN should be in conformity with of the Negotiable Instruments Act,
23 1881.
a) Section 2
b) Section 4
c) Section 6
d) Section 8

Revival letters obtained / signed after the expiry of period will not revive the
24 documents and are not enforceable.
a) 3 years
b) 5 Years
c) 7 Years
d) 8 Years
 The remitting customer has to furnish which of the following information to a
25 bank for effecting a RTGS remittance?
a) Amount to be remitted
b) Name of the beneficiary banj
c) Account number of the beneficiary customer
d) All of the above
 IIBF MOCK TEST SET 14
Which of the following precautions are to be taken while opening accounts for
1 blind persons?
a Various risks in operatiopns of the account be explained to the account holder
The account has to be signed for and on behalf of the firm by all the authorized
b partners and not in an individual name.
In case the firm is to furnish a guarantee to the bank, all the partners have to sign
c the document.
A cheque payable to the firm cannot be endorsed by a partner in his name and
d credited to his personal account.

Customers shoud be informed at lease before the date of maturity and seek their
2 instructions
a 30 days
b 7 days
c 15 days
d 60 days

Recovery agents have a duty to exercise reasonable care and skill in recovery
3 functions, in terms of:
a The contract Act
b The IBA's Model Policy on collection of dues
c The RBI's guidelines on recovery agents engaged by banks
d All the above

Kannan pays his loan instalments on time. What kind of an asset is his loan to the
4 Bank?
a Standard Asset
b Substandard Asset
c Doubtful Asset
d Lost Asset

An OPC can converty voluntarily into any kind of company after have expired
5 from the date of incorporation.
a 6 months
b 1 year
c 2 years
d 3 years

In Which cards, transactions by the card holder are accumulated over a period of
6 time generally a month and the total amount of the carde holder?
a Charge Card
b Credit Card
c Smart Cards
d Member Card

Banks should not make payment of cheqyes / drafts / banker's cheques bearing
7 that date of any subsequent date, if they are presented beyond the period of
from the date of such instrument.
a 1 month
b 2 months
c 3 months
d 4 months

You deposit Rs. 10,000 with a bank for one year at 6% interest p.a. The Bank pays
8 monthly compounded interest which is reinvested in the account.
What amount you get on maturity of your deposit?
a Rs.6984
b Rs. 8456
c Rs.10617
d Rs.12356

Which is an ideal form of organization when a business is to be expanded a large

9 scaole without involving large number of shareholder groups?
a Public Limited Company
b Private Limited Company
c Government Company
d None of the above

1
0 The Laws and regulations which govern debt recovery of a bank's dues apply :
a to the bank's employees engaged in recovery process
b to the recovery agents engaged by the bank
c to the bank's employees and its recovery agents
d to borrowers only

1 Which risk arising due to technology failure fraud error inadequate financial
1 capacity to fulfill obkigations and / or private remedies?
a Legal risk
b Operational risk
c Repulation risk
d Strategic risk
1
2 The recovery agents of a bank should follow :
a Only the debt recovery policy and procedure of the bank (Principal)
b Only the directives of RBI on recovery agents engaged by banks
c Only the Model Policy on collection of dues etc., framed by IBA
d All the above

1
3 Which Method is also known as Tandon's ll method of lending?
a MPBF method
b Operating Cycle Method
c Drawing Power (DP) Method
d Turnover Method

1
4 What should be the minimum paid up capital for Private Limited Company?
a Rs.50,000
b Rs.75,000
c Rs.1,00,000
d Rs.3,00,000

1 The debt recovery agent is legally entitled to collect specified receivables from
5 the debtors on behalf of the principal in terms of :
a Oral agreement
b Implied authority
c Loan agreement and Debt collection agency agreement
d Indian contract act

1
6 What is CFT under KYC / AML regulations?
a Combating the financing of terrorism
b Calculating financial terrorism
c Commissiom on financial terrorism
d Committee on financial terrorism

1
7 One of the following statements is not true
a The Court cannot condodne delay in filling suit, if the document is time - barred.
If a demand promissory note is not stamped before or at the time of execution in
b India, the defect can be set right by paying penalty.
When the borrower acknowledges the debt beforeor the expiry of limitation is
c extended by one more period.
 If the borrower makes part payment into the loan account before the expiry of
d limitation period, the period of limitation is extended by one more period.

1 On receipt of an application, the Tribunal shall issue summons, requiring the

8 defendant to show cause within of the service of summons as to why
the relief prayed for should not be granted
a 15 days
b 30 days
c 45 days
d 60 days

1 Rahman had taken a loan for business 3 years back. For more than 2 years he is
9 not able to give instalments as his business has suffered loss
and is almost closed down
(i) What kind of NPA is it?
(ii) In this case, who determines the class of asset?
(i) Sub standard Assets (ii) It is identified by the Bank or auditors, or the RBI
a inspection
b (i) Loss Asset (ii) It is identified by the Bank or auditors, or the RBI inspection

2 In Limited liability Partnership, Audit of accounts is required if the

0 contributionexceeds or annual turnover exceeds .
a Rs.15 lakhs, Rs. 30 Lakhs
b Rs.25 lakhs, Rs. 40 Lakhs
c Rs.35 lakhs, Rs. 50 Lakhs
d Rs.45 lakhs, Rs. 60 Lakhs

2
1 In this case who determines the class of asset?
(i) Sub-standard Asset (ii) It is identified by the Bank or auditors, or the RBI
a Inspection
b (i) Loss Asset (ii) It is identified by the Bank or auditors, or the RBI inspection
c (i) Loss Asset (ii) It is identified by the DCA
d (i) Doubtful Asset (ii) It is identified by the DRA

2 In a home loan recovery case, the particulars of the property mortgaged (i.e. the
2 security) for the loan can be found from :
a The Loan agreement between the debtor and the lender and its schedule
b The loan application form submitted by the debtor to the lender
c Both the above
d None of the above
2 In which of the following card, the amount of dues from the card holder for each
3 and every transaction is debited to cardholders account as soon as
each transaction is notified to the ussuer?
a Credit Cards
b Smart Cards
c Debit Cards
d Member Card

2
4 The Process of Money Laundering is said to be taken place in how many phases?
a 1
b 2
c 3
d 4

2
5 The difference between the credit and the debit card is :
a Your account gets debited immediately on using a credit card
b Your account gets debited immediately on using a debit card
c Your account does not gets debited immediately on using a credit card
d None of the above
 IIBF MOCK TEST SET 15
What is a transferable, signed document that promises to pay the bearer a sum of
1 money at a future date or an demand?
a Passbook
b Negotiable instrument
c Non-performing asset
d Margin

In Which of the following card, the amount of dues from the card holder for each
2 and every transaction is bebited to
card holders account as soon as each transaction is notified to the issuer?
a Credit Cards
b Smart Cards
c Debit Cards
d Member Card

Generally the first bucket includes those accounts which are over due for a period
3 of less than
a 50 days
b 91 days
c 120 days
d 150 days

which risk arising due to technology failure,fraud,error,inadequate financial

4 capacity to fulfill obligations and/or provide remedies?
a Legal rish
b Operational risk
c Reputation risk
d Stategic risk

What is a right of the creditor to retain the possession of the goods and securities
5 owned by the debtor until the debt
due by the customer is paid?
 a Lien
b Set-off
c Appropriation
d Mortgage

Which are banks incorporated in India whose shares are held by public. Majority
6 of these banks belong to the
category of old generation private banks characterized by small balance sheet
size, regional operations and business activities?
a Foreign Banks
b Indian Private Sector Banks
c Local Area Banks
d Payment Banks

While employing persons for recovery, the service providers engaged by banks
7 should ensure which of the following?
They Should employ only such personnel who undertake to undergo the training
a for 100 hours and obtain the certificate from
the IIBF within one year from date of employment.
They Should employ only such personnel who undertake to undergo the training
b for 100 hours and obtained the certificate from
the IIBF within one year from date of employment.
They Should employ only such personnel who undertake to undergo the training
c for 100 hours and obtain
d None of the above

Which deposits are repayable on demand by the customers and these consists of
8 current account deposits and Savings bank
deposits?
a Hybrid deposits
b Term deposits
c Demand deposits
d None of the above

9 What relations is created when the bank collects a cheque in clearing?

a Clearing member and Principal
b Agent and Principal
c Collecting Bank and Holder
d None of the above

Which deposits are a combination of demand and fixed deposits for meeting
10 customer's financial needs in a flexible manner?
 a Recurring deposits
b Fixed deposits
c Hybrid deposits
d Term deposits

11 TheBanks provide Safe Deposits Lockers then it is defined as what relationship?

a Relationship Debtor - Creditor
b Relationship Beneficiary - Trustee
c Relationship Principal - Agent
d Relationship Lessee - Lessor

From an Individual Customer, Which of the following of the following documents

12 can be accepted for the purpose of
identification under KYC Guidelines of RBI
a Telephone Bill
b Ration Card
c Voter Identity Card
d Any of these

13 Account of a Minnor can be

a In the single name of the child but operated by parents or guardian
In the joint names of parents or gurdian and the child, payable to either or
b survivor
c In the single of a minor above specified age and operated by himself / herself
d All of the above

14 If a bill is not paid for 13 months, what kind of asset is it to the Bank?
a Standard Asset
b Substandard Asset
c Doubtful Asset
d Loss Asset

15 Who identifies Loss Asset?

a DRA or DCA
b Bank or auditors
c The RBI inspection
d B or C

16 Which method is also known as Tandon's ll method of lending?

a MPBF method
b Operating Cycle Method
c Drawing Power (DP) method
 d Turnover Method

17 Disadvantages to Credit card holders :

a Over Spending ending in Debt Trao
b Frauds due to loss or theft of cards
c Forget signatures
d All of above

Full KYC exercise should be done at least every for high risk individuals and
18 entities.
a 1 year
b 2 years
c 3 years
d 4 years

Under SAFFAESI Act, the borrower can seek any clarification and the bank is
19 legally bound to answer the queries within
of such request.
a 5 days
b y days
c 15 days
d 30 days

In which rate the rate of interest changes depending upon the market conditions
20 subject to the reset clause,
If any, incorporated in the loan agreement?
a Fixed rate
b floating rate
c
d

21 Tarun is the product of MUDRA, which covers loans up to .

a Rs.50,000 and up to Rs. 5,00,000
b Rs.3,00,000 and up to Rs. 5,00,000
c Rs.5,00,000 and up to Rs.10,00,000
d Rs.10,00,000 and up to Rs. 13,00,000

In cases the debtors /guarantors have means and assets but are onwilling to repay
22 the loan, the debt recovery
agent can recommend .
a Illegal action
b Legal action
 c Tracing debtors
d None of the above

What is a loan or an advance where interest and / or instalment of principal

23 remains overdue for a period of
more than 90 days in respect iof a term loan?
a Housing Loan
b Non - Performing essets
c Demand loan
d Performing assets

Which is a new institution set up by Government of India to provide funding to

24 the non- corporate, non- farm sector
income generating activities of micro and small enter prises whose credit needs
are below Rs.10 lakhs?
a PMJDY
b MITHRA
c MUDRA
d None of the above

In case of advances to limited companies against in assets, the required forms are
25 to presented to the Registrar of
Companies within a period of from the date of execution.
a 7 days
b 15 days
c 30 days
d 45 days
 IIBF MOCK TEST SET 16
Debt collecting agencies with nation - wide presence and large resources and
1 computerized database also act as of defaulters /
debtors who have disappeared and are not traceable by the credit institution.
a Tracing agent
b Compilling opinion reports
c Reporters
d None of the above

Bank branches should maintain a wait list for the purpose of allotment of lockers
2 and ensure transparency in allotment of lockers. Say whether True or False

a True
b False

3 Attachment order in respect of bank accounts is issued by:

a RBI
b Ombudsman
c IBA
d Tax Authorities

Which risk is due to Privacy, cusumer and prudential laws not a adequately
4 complied with?
a Repulation risk
b Legal risk
c Compliance risk
d Exit strategy risk

What is the security other than the primary security lodged with the bank by the
5 borrower or by a third party?
a Primary Security
b Tangible Security
c Collateral Security
 d Personal Security

Who means a person who is engaged in the financial transaction or activity with a
6 Regulated Entity (RE) and includes a person on
whose behalf the person who is engaged in the transaction or activity, is acting?
a Banker
b Customer
c Banking
d Non of the above

Limitation period fro filling suit for sale of an immovable property is thirty years
7 from the date mortgage debt becomes due.
a True
b False

What is the process of evaluating an applicant's loan request or a corporation's

8 debt issue in order to
determine the likelihood that the borrower will live up to his / her obligations?
a Credit limit
b Credit analysis
c Credit rating
d Credit card

9 Which of the following are some important points for debt recovery agents?
a Don't exceed the authority given in the recovery arrangement
Don’t intrude into the privacy of the debtor's family members, friends /
b colleagues.
c Both (a) and (b)
d None of the above

What is one where loss has beene identified by the bank or its internal or external
10 auditors, or by the RBI
inspection, but the amount has not been written off wholly?
a Doubtful Addets
b Loss Assets
c Standard Assets
d Sub -standard Assets

11 Current account deposits are not entitled to

a Cheque book above 100 leaves
b Monthly Statements
c Cash payments
 d Interest

12 Money Laundering refers to

a Conversation of assets into cash
b Conversation of money which is illegally obtained
c Conversation of cash into gold
d Conversation of assets into cash

Banks should return / dispatch dishonored instruments to the customer promptly

13 without delay in any case within .
a 24 hours
b 36 Hours
c 48 hours
d 60 hours

, wherein the account will be operated only by the first named depositor and the
14 balance will be payable to
only the first named depositor or if the first named is deceased, the survivor, as
the case may be.
a either or survivor
b both jointly or survivor
c former or survivor
d any two jointly or last survivor

The form of DPN should be in conformity with of the Negotiable Instruments Act,
15 1881.
a Section 2
b Section 4
c Section 6
d Section 8

The Banking codes and Standards Board of India is an autonomous and

16 independent body set up by the .
a RBI
b SEBI
c IRDAI
d CBI

What refers to communication plus skill that enhances that relationship and
17 understanding between two or more
persons and thus includes communication and listening skills plus something
more?
 a Peruasive skill
b Listening skill
c Inter - personal Skill
d Negotiation skill

Banks have to file a suit before the civil court for recovery, if the amount due in
18 the loan account is less than
before the debt Recovery Tribunal (DRT).
a Rs.10 Lakhs
b Rs. 15 Lakhs
c Rs.20 Lakhs
d Rs.25 Lakhs

19 A Housing loan is granted against the security of .

a Pledge of the house financed
b Hypothecation of the house financed
c Mortgage of the houser financed
d Lien of the house financed

Which means offering all banking products & services [both fee based and fund
20 based services] under
one roof and banks are making lower profit margins on their lending business with
increased competition?
a Financial inclusion
b Agricultural Banking
c Universal Banking
d Electonic Banking

21 HUF can be admitted as apartnership firm Say True or False.

a TRUE
b FALSE

Who may be defined as a person or entity engaged by a financial institution, or

22 some other entity for the purpose
of colle cting specified loans, or advances or other kind of debts from the debtors
in accordance with the specified
terms and conditions?
a Local Recovery Agent
b Mutual Fund Agent
c LIC Agent
d Debt Recovery Agent
23 Those who can pay the reduced amount as negotiated with them is called as?
a Normal debtors
b Doubtful debtors
c Difficult debtors
d none of the above

24 Which of the following are disadvantages of Debt Collecting Recovery Agency?

a A Skilfully negotiated debt collection could mean savings on litigation cost
b Debt Collection does cost money
The process of assingning debt collection ot outsiders enables officials from banks
c to develop more
remunerative new business.
d None of the above

Private limited company should have minimum of members and a maximum of

25 members
a 2,200
b 3,300
c 5,500
d 10 no limit