MONEY AND BANKING (Part – I)

Total Questions: 150

131. Which of the following banks operates mainly in relation to small industries? [U.P.P.C.S. (Mains ) 2012]

(a) SIDBI
(b) IDBI
(c) ICICI
(d) NABARD

Correct Answer: (a) SIDBI

Solution:

It was set up on 2nd April, 1990, under an Act of the Indian Parliament.
Purpose: To act as the principal financial institution for promotion, financing, and development of the Micro, Small and Medium Enterprise (MSME) sector, as well as for the co-ordination of functions of institutions engaged in similar activities.
It is under the jurisdiction of the Ministry of Finance, Gol.
It was incorporated in initially as a wholly owned subsidiary of the Industrial Development Bank of India (IDBI).
Currently the shares of SIDBI are held by the Government of India (Gol) and 22 other institutions/PSBs/insurance companies owned or controlled by the Central Government.
Headquarters: Lucknow, Uttar Pradesh
SIDBI helps MSMEs in acquiring the funds they require to grow, market, develop, and commercialize their technologies and innovative products.
The bank provides several schemes and also offers financial services and products to meet individual requirements of various businesses.
Financial support to MSMEs is provided by way of
Indirect/refinance to banks/Financial Institutions for onward lending to MSMES

Direct finance in niche are as like risk capital, sustainable finance, receivable financing, service sector financing, etc.

SIDBI was made responsible for administering the Small Industries Development Fund and the National Equity Fund that were administered by IDBI before.
In order to promote and develop the MSME sector, SIDBI adopts a 'Credit Plus' approach, under which, besides credit, SIDBI supports enterprise development, skill upgradation, marketing support, cluster development, technology modernization, etc.

132. When was the Small Industries Development Bank of India (SIDBI) established? [M.P.P.C.S. (Pre) 2023]

(a) April, 1990
(b) January, 1950
(c) August, 1995
(d) May, 2005

Correct Answer: (a) April, 1990

Solution:

It was set up on 2nd April, 1990, under an Act of the Indian Parliament.
Purpose: To act as the principal financial institution for promotion, financing, and development of the Micro, Small and Medium Enterprise (MSME) sector, as well as for the co-ordination of functions of institutions engaged in similar activities.
It is under the jurisdiction of the Ministry of Finance, Gol.
It was incorporated in initially as a wholly owned subsidiary of the Industrial Development Bank of India (IDBI).
Currently the shares of SIDBI are held by the Government of India (Gol) and 22 other institutions/PSBs/insurance companies owned or controlled by the Central Government.
Headquarters: Lucknow, Uttar Pradesh
SIDBI helps MSMEs in acquiring the funds they require to grow, market, develop, and commercialize their technologies and innovative products.
The bank provides several schemes and also offers financial services and products to meet individual requirements of various businesses.
Financial support to MSMEs is provided by way of
Indirect/refinance to banks/Financial Institutions for onward lending to MSMES

Direct finance in niche are as like risk capital, sustainable finance, receivable financing, service sector financing, etc.

SIDBI was made responsible for administering the Small Industries Development Fund and the National Equity Fund that were administered by IDBI before.
In order to promote and develop the MSME sector, SIDBI adopts a 'Credit Plus' approach, under which, besides credit, SIDBI supports enterprise development, skill upgradation, marketing support, cluster development, technology modernization, etc.

133. The Head Office of Small Industries Development Bank of India (SIDBI) is located at : [U.P.R.O./A.R.O. (Mains) 2016, U.P.R.O/A.R.O. (Mains) 2021]

(a) Ghaziabad
(b) Lucknow
(c) Kanpur
(d) New Delhi

Correct Answer: (b) Lucknow

Solution:

It was set up on 2nd April, 1990, under an Act of the Indian Parliament.
Purpose: To act as the principal financial institution for promotion, financing, and development of the Micro, Small and Medium Enterprise (MSME) sector, as well as for the co-ordination of functions of institutions engaged in similar activities.
It is under the jurisdiction of the Ministry of Finance, Gol.
It was incorporated in initially as a wholly owned subsidiary of the Industrial Development Bank of India (IDBI).
Currently the shares of SIDBI are held by the Government of India (Gol) and 22 other institutions/PSBs/insurance companies owned or controlled by the Central Government.
Headquarters: Lucknow, Uttar Pradesh
SIDBI helps MSMEs in acquiring the funds they require to grow, market, develop, and commercialize their technologies and innovative products.
The bank provides several schemes and also offers financial services and products to meet individual requirements of various businesses.
Financial support to MSMEs is provided by way of
Indirect/refinance to banks/Financial Institutions for onward lending to MSMES

Direct finance in niche are as like risk capital, sustainable finance, receivable financing, service sector financing, etc.

SIDBI was made responsible for administering the Small Industries Development Fund and the National Equity Fund that were administered by IDBI before.
In order to promote and develop the MSME sector, SIDBI adopts a 'Credit Plus' approach, under which, besides credit, SIDBI supports enterprise development, skill upgradation, marketing support, cluster development, technology modernization, etc.

134. Consider the following pairs : [U.P.P.C.S (Mains) 2014]

(Name of the banks)	(Locations of Head Office)
1. Allahabad Bank	Kolkata
2. Small Industries Development Bank of India	Mumbai
3. Indian Overseas Bank	Chennai

Which one of the above pairs is not correctly matched?

(a) 1 only
(b) 2 only
(c) 3 only
(d) 1 and 3 only

Correct Answer: (b) 2 only

Solution:

It was set up on 2nd April, 1990, under an Act of the Indian Parliament.
Purpose: To act as the principal financial institution for promotion, financing, and development of the Micro, Small and Medium Enterprise (MSME) sector, as well as for the co-ordination of functions of institutions engaged in similar activities.
It is under the jurisdiction of the Ministry of Finance, Gol.
It was incorporated in initially as a wholly owned subsidiary of the Industrial Development Bank of India (IDBI).
Currently the shares of SIDBI are held by the Government of India (Gol) and 22 other institutions/PSBs/insurance companies owned or controlled by the Central Government.
Headquarters: Lucknow, Uttar Pradesh
SIDBI helps MSMEs in acquiring the funds they require to grow, market, develop, and commercialize their technologies and innovative products.
The bank provides several schemes and also offers financial services and products to meet individual requirements of various businesses.
Financial support to MSMEs is provided by way of
Indirect/refinance to banks/Financial Institutions for onward lending to MSMES

Direct finance in niche are as like risk capital, sustainable finance, receivable financing, service sector financing, etc.

SIDBI was made responsible for administering the Small Industries Development Fund and the National Equity Fund that were administered by IDBI before.
In order to promote and develop the MSME sector, SIDBI adopts a 'Credit Plus' approach, under which, besides credit, SIDBI supports enterprise development, skill upgradation, marketing support, cluster development, technology modernization, etc.

135. SIDBI has been established to : [U.P.P.C.S. (Mains) 2004]

(a) Finance cottage industries
(b) Finance small scale industries
(c) Finance large-scale industries
(d) Finance public sector undertakings

Correct Answer: (b) Finance small scale industries

Solution:

It was set up on 2nd April, 1990, under an Act of the Indian Parliament.
Purpose: To act as the principal financial institution for promotion, financing, and development of the Micro, Small and Medium Enterprise (MSME) sector, as well as for the co-ordination of functions of institutions engaged in similar activities.
It is under the jurisdiction of the Ministry of Finance, Gol.
It was incorporated in initially as a wholly owned subsidiary of the Industrial Development Bank of India (IDBI).
Currently the shares of SIDBI are held by the Government of India (Gol) and 22 other institutions/PSBs/insurance companies owned or controlled by the Central Government.
Headquarters: Lucknow, Uttar Pradesh
SIDBI helps MSMEs in acquiring the funds they require to grow, market, develop, and commercialize their technologies and innovative products.
The bank provides several schemes and also offers financial services and products to meet individual requirements of various businesses.
Financial support to MSMEs is provided by way of
Indirect/refinance to banks/Financial Institutions for onward lending to MSMES

Direct finance in niche are as like risk capital, sustainable finance, receivable financing, service sector financing, etc.

SIDBI was made responsible for administering the Small Industries Development Fund and the National Equity Fund that were administered by IDBI before.
In order to promote and develop the MSME sector, SIDBI adopts a 'Credit Plus' approach, under which, besides credit, SIDBI supports enterprise development, skill upgradation, marketing support, cluster development, technology modernization, etc.

136. 'Financial Inclusion' can be encouraged : [U.P.P.C.S. (Spl.) (Mains) 2008]

(a) by issuing a 'specific letter of credit' to the deserving beneficiaries.
(b) by providing banking service to people of lower income group with 'zero' or 'minimum balance'
(c) by providing financial services to low income group.
(d) by all of the above

Correct Answer: (d) by all of the above

Solution:

It was set up on 2nd April, 1990, under an Act of the Indian Parliament.
Purpose: To act as the principal financial institution for promotion, financing, and development of the Micro, Small and Medium Enterprise (MSME) sector, as well as for the co-ordination of functions of institutions engaged in similar activities.
It is under the jurisdiction of the Ministry of Finance, Gol.
It was incorporated in initially as a wholly owned subsidiary of the Industrial Development Bank of India (IDBI).
Currently the shares of SIDBI are held by the Government of India (Gol) and 22 other institutions/PSBs/insurance companies owned or controlled by the Central Government.
Headquarters: Lucknow, Uttar Pradesh
SIDBI helps MSMEs in acquiring the funds they require to grow, market, develop, and commercialize their technologies and innovative products.
The bank provides several schemes and also offers financial services and products to meet individual requirements of various businesses.
Financial support to MSMEs is provided by way of
Indirect/refinance to banks/Financial Institutions for onward lending to MSMES

Direct finance in niche are as like risk capital, sustainable finance, receivable financing, service sector financing, etc.

SIDBI was made responsible for administering the Small Industries Development Fund and the National Equity Fund that were administered by IDBI before.
In order to promote and develop the MSME sector, SIDBI adopts a 'Credit Plus' approach, under which, besides credit, SIDBI supports enterprise development, skill upgradation, marketing support, cluster development, technology modernization, etc.

137. Which one of the following is not the objective of financial inclusion? [U.P.P.C.S. (Pre) 2016]

(a) To extend financial service to poor population.
(b) To unlock the door of growth potential of weaker section.
(c) Shrinking of banking infrastructure.
(d) To extend financial sector into rural areas.

Correct Answer: (c) Shrinking of banking infrastructure.

Solution:Extending financial services to poor population, unlocking the door of growth potential of weaker section of the society and extending financial sector into rural areas are objectives of financial inclusion. The objective of financial inclusion includes expanding the banking infrastructure in underserved areas. Hence, option (c) is the correct answer.

138. Which one of the following is a hindrance in the process of financial inclusion? [U.P.U.D.A/L.D.A. (Pre) 2013]

(a) low income
(b) illiteracy
(c) lack of banks' branches
(d) All of the above

Correct Answer: (d) All of the above

Solution:According to the C. Rangarajan Committee on Financial Inclusion, financial inclusion is the process of ensuring access to financial services and timely and adequate credit where needed by vulnerable groups such as weaker sections and low income groups at an affordable cost. Low income, illiteracy and lack of banks' branches all of these are hindrances in the process of financial inclusion.

139. Who among the following was the Chairman of the 'Committee on Financial Inclusion' constituted in January 2005? [U.P.U.D.A./L.D.A. (Pre) 2013]

(a) C. Rangarajan
(b) D. Subbarao
(c) M.S. Ahluwalia
(d) Kamal Nath

Correct Answer: (a) C. Rangarajan

Solution:The Committee on Financial Inclusion was actually constituted by the Government of India (Chairman Dr. C. Rangarajan) on June 26, 2006 to prepare a strategy of financial inclusion. The Committee submitted its final Report on January 4, 2008. The Report viewed financial inclusion as a comprehensive and holistic process of ensuring access to financial services and timely and adequate credit, particularly by vulnerable groups such as weaker sections and low income groups at an affordable cost. Financial inclusion, therefore, according to the Committee, should include access to mainstream financial products such as bank accounts, credit, remittances and payment services, financial advisory services and insurance facilities

140. Which of the following committees has given its recommendations on 'financial inclusion'? [U.P.P.S.C. (R.I.) 2014]

(a) Rakesh Mohan Committee
(b) Sinha Committee
(c) Rangarajan Committee
(d) Kelkar Committee

Correct Answer: (c) Rangarajan Committee

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MONEY AND BANKING (Part – I)

131. Which of the following banks operates mainly in relation to small industries? [U.P.P.C.S. (Mains ) 2012]

132. When was the Small Industries Development Bank of India (SIDBI) established? [M.P.P.C.S. (Pre) 2023]

133. The Head Office of Small Industries Development Bank of India (SIDBI) is located at : [U.P.R.O./A.R.O. (Mains) 2016, U.P.R.O/A.R.O. (Mains) 2021]

134. Consider the following pairs : [U.P.P.C.S (Mains) 2014]

135. SIDBI has been established to : [U.P.P.C.S. (Mains) 2004]

136. 'Financial Inclusion' can be encouraged : [U.P.P.C.S. (Spl.) (Mains) 2008]

137. Which one of the following is not the objective of financial inclusion? [U.P.P.C.S. (Pre) 2016]

138. Which one of the following is a hindrance in the process of financial inclusion? [U.P.U.D.A/L.D.A. (Pre) 2013]

139. Who among the following was the Chairman of the 'Committee on Financial Inclusion' constituted in January 2005? [U.P.U.D.A./L.D.A. (Pre) 2013]

140. Which of the following committees has given its recommendations on 'financial inclusion'? [U.P.P.S.C. (R.I.) 2014]

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