NABARD Grade A General Awareness, Current Affairs and Banking Knowledge Syllabus

What is the difference between a NPA classification of Substandard, Doubtful, and Loss assets?

Sub-standard: NPA for up to 12 months. Doubtful: remained sub-standard for more than 12 months. Loss asset: identified as a loss by the bank/auditor/RBI but not yet fully written off. (An asset becomes NPA when overdue for more than 90 days.)

What is Priority Sector Lending (PSL) and what is the overall target for domestic commercial banks?

PSL directs banks to lend to specified sectors (agriculture, MSME, education, housing, etc.). The overall target is 40% of Adjusted Net Bank Credit (ANBC), with 18% for agriculture and additional sub-targets for weaker sections and small/marginal farmers.

What is the Kisan Credit Card (KCC) scheme?

The KCC scheme, launched in 1998, provides farmers with timely, adequate short-term credit for cultivation and other needs through a single credit card/passbook, with flexible and simplified procedures. It was conceptualised by NABARD.

What is the Self Help Group (SHG)-Bank Linkage Programme?

Launched by NABARD in 1992, it links informal Self Help Groups (typically of rural women) with banks for savings and credit, promoting financial inclusion and microfinance. It is the largest microfinance programme in the world.

What is a CASA ratio?

CASA (Current Account Savings Account) ratio is the proportion of a bank's total deposits held in current and savings accounts. A higher CASA ratio means cheaper funds (lower interest cost) for the bank.

What is the difference between a Demand Deposit and a Time Deposit?

Demand deposits (current and savings accounts) can be withdrawn on demand without notice. Time deposits (fixed/recurring deposits) are kept for a fixed term and earn higher interest; early withdrawal may attract a penalty.

What is deposit insurance in India and what is the current cover per depositor?

Bank deposits are insured by the DICGC (Deposit Insurance and Credit Guarantee Corporation), a subsidiary of RBI. The insurance cover is up to Rs 5 lakh per depositor per bank (raised from Rs 1 lakh in 2020).

What is the Money Market and which instruments are traded in it?

The money market is for short-term funds (maturity up to one year). Instruments include Treasury Bills, Call Money, Certificates of Deposit (CDs), Commercial Paper (CP), and Repos.

What is the difference between the Money Market and the Capital Market?

The money market deals in short-term instruments (up to 1 year) for liquidity, regulated mainly by RBI. The capital market deals in long-term instruments (over 1 year) like shares and bonds for raising long-term capital, regulated by SEBI.

What are Treasury Bills (T-Bills)?

T-Bills are short-term money market instruments issued by the Government of India (through RBI) at a discount and redeemed at face value. They are issued in 91-day, 182-day, and 364-day maturities and carry no interest (zero-coupon).

What is Commercial Paper (CP)?

Commercial Paper is an unsecured, short-term money market instrument issued at a discount by large creditworthy corporations, primary dealers, and financial institutions to meet short-term funding needs.

What is the difference between the Primary Market and the Secondary Market?

In the primary market, securities are issued for the first time (e.g., IPOs) and funds go to the issuer. In the secondary market (stock exchanges), existing securities are traded among investors, providing liquidity.

What is UPI and who operates it?

UPI (Unified Payments Interface) is a real-time, instant inter-bank payment system enabling money transfer via mobile using a Virtual Payment Address (VPA). It is operated by NPCI (National Payments Corporation of India) and was launched in 2016.

What is NPCI?

NPCI (National Payments Corporation of India) is the umbrella organisation for operating retail payments and settlement systems in India. It was set up in 2008 by RBI and IBA. It operates UPI, RuPay, IMPS, NACH, AePS, FASTag, and BHIM.

What is the difference between RTGS and NEFT?

RTGS (Real Time Gross Settlement) settles transactions individually in real time and is used for high-value transfers (minimum Rs 2 lakh, no upper limit). NEFT (National Electronic Funds Transfer) settles in batches and has no minimum or maximum limit. Both now operate 24x7.

What is IMPS?

IMPS (Immediate Payment Service) is a 24x7 instant interbank electronic fund transfer service through mobile, internet, and ATM, operated by NPCI.

What is a Central Bank Digital Currency (CBDC) / the Digital Rupee (e-Rupee)?

CBDC is a legal-tender digital form of a country's fiat currency issued by the central bank. In India, the RBI launched the Digital Rupee (e-Rupee) pilots in 2022 in wholesale (e-W) and retail (e-R) segments.

What is the Pradhan Mantri Jan Dhan Yojana (PMJDY)?

PMJDY, launched in August 2014, is the national financial inclusion mission to provide universal access to basic banking accounts (zero balance), RuPay debit card, accident insurance, and overdraft facility to the unbanked.

What is the difference between Microfinance Institutions (MFIs) and NBFCs?

NBFCs (Non-Banking Financial Companies) are companies providing banking-type financial services without a banking licence and cannot accept demand deposits. MFIs are a category of NBFC (NBFC-MFI) focused on providing small loans to low-income and rural borrowers.

What is the function of the Monetary Policy Committee (MPC) and how many members does it have?

The MPC, constituted under the RBI Act (amended 2016), is responsible for setting the policy repo rate to achieve the inflation target. It has 6 members: 3 from RBI (including the Governor as chairperson) and 3 nominated by the Government. The Governor has a casting vote.

What is India's flexible inflation targeting framework?

Under the agreement between the Government and RBI, the inflation target is 4% CPI inflation with a tolerance band of +/- 2% (i.e., 2% to 6%). The MPC aims to keep retail (CPI) inflation within this band.

What is the difference between Fiscal Deficit and Revenue Deficit?

Fiscal deficit is the excess of total government expenditure over total revenue (excluding borrowings), indicating total borrowing needs. Revenue deficit is the excess of revenue expenditure over revenue receipts.

What is the difference between Repo and Open Market Operations (OMO)?

Repo is short-term lending/borrowing by RBI for temporary liquidity adjustment. OMO is the outright buying (to inject liquidity) and selling (to absorb liquidity) of government securities by RBI in the open market, affecting durable liquidity.

What is the Atal Pension Yojana (APY)?

APY, launched in 2015, is a government-backed pension scheme primarily for workers in the unorganised sector, regulated by PFRDA. It provides a guaranteed minimum monthly pension of Rs 1,000 to Rs 5,000 after age 60 based on contributions.

What are the three Pradhan Mantri social security insurance schemes launched in 2015?

PMJJBY (Pradhan Mantri Jeevan Jyoti Bima Yojana - life insurance), PMSBY (Pradhan Mantri Suraksha Bima Yojana - accident insurance), and APY (Atal Pension Yojana - pension).

What is the Pradhan Mantri Fasal Bima Yojana (PMFBY)?

PMFBY, launched in 2016, is the flagship crop insurance scheme providing financial support to farmers against crop loss due to natural calamities, pests, and diseases, with low premium rates (2% for Kharif, 1.5% for Rabi food/oilseed crops).

What is the difference between Kharif and Rabi crops?

Kharif crops are sown at the start of the monsoon (June-July) and harvested in autumn (e.g., rice, maize, cotton, soybean). Rabi crops are sown in winter (October-November) and harvested in spring (e.g., wheat, barley, mustard, gram).

What is the Minimum Support Price (MSP) and who recommends it?

MSP is the guaranteed price at which the government purchases crops from farmers to protect them from price falls. It is recommended by the Commission for Agricultural Costs and Prices (CACP) and announced by the Government for notified crops.

What is the Green Revolution in India and who is regarded as its father?

The Green Revolution (mid-1960s onward) was the adoption of high-yielding variety (HYV) seeds, irrigation, fertilizers, and modern techniques that made India self-sufficient in foodgrains. M.S. Swaminathan is regarded as the Father of the Green Revolution in India; Norman Borlaug is its global father.

What is the World Bank Group and where is it headquartered?

The World Bank Group, headquartered in Washington, D.C., is an international financial institution providing loans and grants for development. Its main lending arms are the IBRD and IDA. It was established in 1944 at the Bretton Woods Conference.