General Awareness / Banking Awareness
General Awareness / Banking Awareness tests stable facts about the Indian financial system and the economy, plus a small current-affairs component. For BoB Office Assistant, focus on RBI functions, monetary-policy tools, banking terminology, account types, payment systems, financial inclusion, and basic economic concepts. Current appointments and schemes change, so verify dated facts before the exam.
Core rules
- RBI is India’s central bank: it issues currency, manages foreign exchange, regulates banks, and conducts monetary policy.
- Repo rate is the rate at which banks borrow short-term funds from RBI against government securities; reverse repo is the opposite. A repo hike generally raises borrowing costs.
- CRR is the share of net demand and time liabilities kept as cash with RBI; SLR is held in approved securities. Both reduce lendable resources when raised.
- NEFT, RTGS, IMPS, and UPI are payment systems; RTGS is for high-value, real-time gross settlement, while NEFT operates in batches.
- Priority-sector lending and financial inclusion aim to extend credit to agriculture, MSMEs, and weaker sections.
Worked example
If RBI raises the repo rate, what is the likely effect on a bank’s short-term borrowing cost? Repo is the policy rate for short-term liquidity. A higher repo makes borrowing from RBI costlier, so banks’ cost of funds tends to rise and lending rates may follow. The correct reasoning links policy rate → cost of funds → lending rates, not “repo is the rate RBI pays banks.”
Traps
Swapping repo and reverse repo; confusing CRR with SLR; assuming a rate cut always lowers deposit rates immediately; mixing NEFT with RTGS; treating current-affairs items as permanent facts.