CAIIB 2020 Retail Banking Mock Tests Set 18

Which of the following statements are correct w.r.t. Credit Cards-

I) Credit Cards are customer friendly initiatives empowering them with financial limits to use it for different purposes including cash withdrawals.

II) But credit cards if not used judiciously will result in a debt trap on account of high financial charges and interest charges.

III) Credit Cards Receivables are unsecured advances for banks and hence higher pricing for card receivables.

IV) Profitability from credit card operations is quite high due to higher interest charges but at the same time, the defaults/delinquencies will also be on the higher side.


Options are :

  • Only I,II
  • Only I,II,IV
  • Only I,III,IV
  • All of the above viz. I,II,III,IV

Answer :All of the above viz. I,II,III,IV

CAIIB 2020 Retail Banking Mock Tests Set 19

Which of the following statements is correct w.r.t. PPIs for cross-border outward transactions?

I) KYC compliant re-loadable semi-closed and open system PPIs issued by banks having AD-I license (only for permissible current account transactions under FEMA, viz., purchase of goods and services), subject to adherence to extant norms governing such transactions.

II) PPIs shall not be used for any cross-border outward fund transfer and/or for making remittances under the Liberalised Remittance Scheme. Prefunding of online merchant’s account shall not be permitted using such Rupee denominated PPIs.

III) Issuers shall enable the facility of cross-border outward transactions only on explicit request of the PPI holders and shall apply a per transaction limit not exceeding ?. 10,000/- , while per month limit shall not exceed ?. 50,000/- for such cross-border transactions.

IV) In case this facility is made available by issuing the PPI in card form, then this PPI shall be EMV Chip and PIN compliant.


Options are :

  • Only I
  • Only II
  • Only III
  • All of the above viz. I,II,III,IV

Answer :All of the above viz. I,II,III,IV

Debit Cards are issued by banks in two ways- 

I) At the time of issue, a generic debit card without embossing the name is issued for immediate operations

II) after opening account, the account details are incorporated and embossed/loaded in the debit card and issued within two/three weeks from the opening of the account.

III) At the time of issue, a customized debit card.With signature of customer in the box given on Debit Card.


Options are :

  • Only I
  • Only I,II
  • Only II,III
  • All of the above viz. I,II,III

Answer :All of the above viz. I,II,III

A __________  is a faster way to pay than a credit or debit card for purchases under ? 2,000/- at participating stores. Instead of dipping (or swiping) the card at the billing counter, simply wave or tap the card on the contactless terminal and pay without entering a PIN (for amount under ? 2,000/-)


Options are :

  • Point to Point Card
  • Tap Card
  • Wave Card
  • Contactless card

Answer :Contactless card

CAIIB 2020 Bank Financial Management Mock Tests Set 1

The characteristics of Debit Cards are

I) Payments for purchases are directly debited into the amount.

II) Cash Withdrawals through ATMs are debited to the account immediately.

III) Payments made for purchases/usage will be debited subsequently after a certain period.


Options are :

  • Only I
  • Only II,IV
  • Only I, II
  • All of the above viz. I,II,III,IV

Answer :Only I, II

What has been the rationale for allowing non-bank entities to set up WLAs?


Options are :

  • To decrease reliance on public sector banks ATMs during holidays.
  • To increase the geographical spread of ATM for increased / enhanced customer service, especially in rural areas.
  • To reduce the operating costs of banks.
  • None of the above.

Answer :To increase the geographical spread of ATM for increased / enhanced customer service, especially in rural areas.

A transaction carried out at an ATM of the card issuing bank is called as -


Options are :

  • On-Us transaction.
  • Off-Us transaction.
  • By-Us transaction.
  • For-Us transaction.

Answer :On-Us transaction.

CAIIB 2020 Bank Financial Management Mock Tests Set 10

With respect to transactions at any other banks’ ATMs (Off-Us transactions) at Metro locations: In case of ATMs located in six metro locations, viz. Mumbai, New Delhi, Chennai, Kolkata, Bengaluru and Hyderabad, banks must offer their savings bank account holders a minimum of ____  free transactions (including both financial and non-financial transactions) in a month.


Options are :

  • 3
  • 5
  • 2
  • 7

Answer :3

A _________ is a card transaction that is carried out through physical presence of card at the point of transaction.


Options are :

  • proximity payment transaction
  • CNP Transaction
  • Contactless transaction.
  • Physical Transaction

Answer :proximity payment transaction

All CP and CNP transactions on cards issued in India are secured with Additional Factor of Authentication (AFA). This AFA can be in any form like -


Options are :

  • PIN
  • dynamic one time password (OTP),
  • static code
  • all of the above

Answer :all of the above

CAIIB 2020 Bank Financial Management Mock Tests Set 11

Retail banking as a business model is adopted by all the banks in India on account of multiple comfort factors for the banks. Which of the following are those factors -

I) acquisition of a huge customer base

II) multiple product offerings

III) better pricing and profitability.

IV) the scope for cross selling and up selling financial and beyond financial products for increased per customer revenue.


Options are :

  • Only I,II
  • Only IV
  • only I,II,IV
  • All of the above viz. I,II,III,IV

Answer :All of the above viz. I,II,III,IV

CAIIB 2020 Bank Financial Management Mock Tests Set 12

Banks adopt different models for implementing their banking initiatives. The most common strategies are-

I) end to end outsourcing.        II) predominant outsourcing. III) partial outsourcing.                IV) in-house sourcing.


Options are :

  • Only I
  • Only II
  • only II,IV
  • All of the above viz. I,II,III,IV

Answer :All of the above viz. I,II,III,IV

Most of the Indian Public Sector Banks use only ________ for retail banking.


Options are :

  • end to end resources.
  • predominant resources.
  • partial resources.
  • in-house resources.

Answer :in-house resources.

In foreign banks, the implementation model of retail banking is mostly _______ on the business model.


Options are :

  • outsourced based
  • in-house based
  • front end based
  • back end based

Answer :outsourced based

CAIIB 2020 Bank Financial Management Mock Tests Set 13

__________ is a modular structure using different process models for different products, offering end to end solutions product wise.


Options are :

  • Horizontally Organised Model
  • Vertically Organised Model
  • Predominantly Vertically Organised Model
  • Predominantly Horizontally Organised Model

Answer :Horizontally Organised Model

___________ provides functionality across products with customer data base orientation and centralized customer data base is used across products.


Options are :

  • Horizontally Organised Model
  • Vertically Organised Model
  • Predominantly Vertically Organised Model
  • Predominantly Horizontally Organised Model

Answer :Vertically Organised Model

_________ is mostly product oriented with common customer information for some products.


Options are :

  • Horizontally Organised Model
  • Vertically Organised Model
  • Predominantly Vertically Organised Model
  • Predominantly Horizontally Organised Model

Answer :Predominantly Vertically Organised Model

CAIIB 2020 Bank Financial Management Mock Tests Set 14

In ____________, common information is available for most of the products.


Options are :

  • Horizontally Organised Model
  • Vertically Organised Model
  • Predominantly Vertically Organised Model
  • Predominantly Horizontally Organised Model

Answer :Predominantly Horizontally Organised Model

The business strategies with regard to the domains targeted are approached in different ways by different banks. The most common approaches is/are-


Options are :

  • Segmented Approach
  • Geography based approach
  • Classification based approach
  • All of the above

Answer :All of the above

In ___________  branches are classified based on the business potential with regard to retail space and business is targeted in this category of branches only with focused marketing strategies.


Options are :

  • Segmented Approach
  • Geography based approach
  • Classification based approach
  • Module Based Approach

Answer :Segmented Approach

CAIIB 2020 Bank Financial Management Mock Tests Set 2

In __________  retail models are built based on Topologies.


Options are :

  • Segmented Approach
  • Geography based approach
  • Classification based approach
  • Module Based Approach

Answer :Geography based approach

In ________________ strategies are designed based on the type of branch viz., Rural, Semi Urban, Urban and Metro. This strategy helps in better product structuring for specific types of branches.


Options are :

  • Segmented Approach
  • Geography based approach
  • Classification based approach
  • Module Based Approach

Answer :Classification based approach

________  is the process of selling multiple banking products and/or services to multiple customers through multiple channels of distribution to earn a profit.


Options are :

  • Consumer Banking
  • HNI Banking
  • Corporate Banking
  • Retail Banking

Answer :Retail Banking

CAIIB 2020 Bank Financial Management Mock Tests Set 3

What are the advantages of retail asset products to banks?

I) Consumer loans are presumed to be of lower risk and NPA perception.

II) Helps economic revival of nation through increased production activity.

III) Improves lifestyle and fulfills aspirations of the people through affordable credit.

IV) Innovative product development credit.


Options are :

  • Only I,III
  • Only II,IV
  • only II,III
  • All of the above viz. I,II,III,IV

Answer :All of the above viz. I,II,III,IV

Liability products are offered to retail banking customers are –


Options are :

  • Savings Accounts
  • Current Accounts
  • Term Deposit Accounts.
  • All of the above.

Answer :All of the above.

These days funds kept in accounts are not allowed to stay idle and funds undertake active travelling by means of ________  from savings accounts to fixed deposit accounts above a certain specified level. This increases the earning potential of the deposit balances in Saving Accounts.


Options are :

  • Auto TDRs
  • Auto Sweep
  • Auto Deposits
  • High Yield Savings Accounts(HYSA)

Answer :Auto Sweep

CAIIB 2020 Bank Financial Management Mock Tests Set 4

What are the advantages of retail liability products to banks?

I) Retail deposits are stable and constitute core deposits.

II) They are interest insensitive and less bargaining for additional interest.

III) They constitute low cost funds for the banks.

IV) The operational cost of retail liability products is far less than retail asset products.


Options are :

  • Only I,III
  • Only II,IV
  • only I, II,III
  • All of the above viz. I,II,III,IV

Answer :only I, II,III

Which of the following are different product development phases in Retail Banking?

I) Hybrid cross pollination by incorporating the best features in the products available in the market along with additional value engineering form part of product development.

II) ‘Follow the leader approach’ by developing on the same line as the market leader.

III) Taking Assistance of overseas retail bankers and checking what’s working best in overseas markets.

IV) Following the instructions of the Top Management without any background research or analysis.


Options are :

  • Only I,III
  • Only I,II,IV
  • only I, II,III
  • All of the above viz. I,II,III,IV

Answer :Only I,II,IV

_________  independently develops the products based on research and on the market dynamics is one way.


Options are :

  • In-House Product Development
  • Follow the leader product development approach
  • Follow the top management approach.
  • None of the above.

Answer :In-House Product Development

CAIIB 2020 Bank Financial Management Mock Tests Set 5

_______  is based purely on market conditions and customer segments without any background research. Done by developing on the same line as the market leader.


Options are :

  • In-House Product Development
  • Follow the leader product development approach
  • Follow the top management approach.
  • None of the above.

Answer :Follow the leader product development approach

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