HPSCB Junior Clerk key terms

The interest rate at which the Reserve Bank of India lends short-term funds to commercial banks against government securities. Raising it makes borrowing costlier and helps control inflation.

The rate at which the RBI absorbs surplus cash from banks by borrowing against securities. It usually sits below the repo rate and is used to drain liquidity from the banking system.

The share of a bank's net demand and time liabilities that must be kept as cash with the RBI. It earns no interest and directly reduces the funds available for lending.

The minimum portion of net demand and time liabilities a bank must hold in safe assets such as government securities, cash or gold. It is maintained with the bank itself, not with the RBI.

The RBI's use of tools like repo rate, CRR and open market operations to manage money supply, credit availability and inflation. The Monetary Policy Committee sets the policy repo rate.

Buying or selling of government securities by the RBI in the market to inject or absorb liquidity. Purchases add money to the system, while sales withdraw it.

The minimum lending rate below which a bank cannot lend to borrowers, calculated from cost of funds, operating expenses and profit margin. It was largely replaced by the marginal cost of funds based lending rate.

Marginal Cost of Funds based Lending Rate, the internal benchmark banks use to price loans. It is linked to deposit costs and repo rate, so policy rate cuts pass on to borrowers faster.

A loan or advance on which principal or interest has remained overdue for more than 90 days. Such assets stop earning income and must be provided for in the bank's books.

A non-performing asset that has remained NPA for a period not exceeding 12 months. It is a stage of asset classification between standard and doubtful assets.

Money a bank sets aside from profits to cover expected losses on bad loans and other risks. Higher provisions reduce reported profit and capital available for lending.

A 2002 law letting banks and financial institutions enforce security interest without going to court, including taking possession and selling secured assets after due notice to a defaulting borrower.

A measure of a bank's capital expressed as a percentage of its risk-weighted assets. It shows how much cushion a bank holds against unexpected losses.

International banking standards on capital, liquidity and risk management framed by the Basel Committee. India follows Basel III rules through RBI guidelines on capital and leverage.

A mandate requiring banks to give a fixed share of credit to agriculture, small enterprises, education, housing and weaker sections. Targets are set by the RBI and shortfalls must be deposited in special funds.

Making affordable banking and financial services available to every section of society, especially the unbanked poor. Schemes like Jan Dhan Yojana and Mudra loans are examples.

Know Your Customer, the process of verifying a customer's identity and address before opening an account or giving a loan. It helps prevent money laundering and fraud.

National Electronic Funds Transfer, an RBI-run system for sending money between bank accounts in batches throughout the day. It is widely used for small and medium transfers across India.

Real Time Gross Settlement, a system where large-value payments are settled instantly and individually, not in batches. The usual minimum transfer amount is two lakh rupees.

Immediate Payment Service, a 24x7 instant interbank transfer facility run by NPCI using mobile or internet banking. It allows small-value transfers at any hour, including holidays.

Unified Payments Interface, a platform that links multiple bank accounts to one mobile app for instant payments using a virtual address. It is operated by NPCI and supports person-to-person and merchant payments.

National Payments Corporation of India, the umbrella organisation that runs retail payment systems such as UPI, IMPS, RuPay and NACH. It is promoted by banks and the RBI.

A process where an image of a cheque is captured and sent electronically for clearing instead of moving the paper cheque. It speeds up clearing and reduces the risk of fraud in transit.

A pooled investment vehicle that collects money from many investors and invests it in shares, bonds or other securities as per a stated objective. Units are managed by a professional asset management company.

Securities and Exchange Board of India, the regulator of the securities market. It protects investors, regulates stock exchanges, mutual funds and intermediaries, and promotes orderly market development.

Systematic Investment Plan, a method of investing a fixed amount in a mutual fund at regular intervals. It averages out purchase cost and encourages disciplined long-term saving.

Interest calculated on both the original principal and the interest already earned, so the amount grows faster than with simple interest. Formula: A = P(1 + r/n)^(nt).

Interest computed only on the original principal for the whole period, without adding earlier interest to it. Formula: SI = (P x R x T) / 100.

A way of expressing a number as a part of one hundred, written with the % sign. It is used to compare quantities and is the base for profit, loss and discount calculations.

A comparison of two or more quantities of the same kind, showing how many times one contains the other. It is written as a:b and has no unit.

An equation stating that two ratios are equal, such as a:b = c:d. In such a proportion the product of the extremes equals the product of the means.

The sum of a set of values divided by the number of values. It is also called the arithmetic mean and is used to find a representative value of a group.

A set of problems based on the relation distance = speed x time. Typical questions involve converting km/h to m/s, relative speed of two moving objects, and trains crossing poles or platforms.

A reasoning topic where two or more statements about categories are given and conclusions must be judged as definitely true, possibly true or false. Venn diagrams are the usual solving tool.

Reasoning questions that present family links through statements or puzzles and ask how two persons are related. Drawing a small family tree with standard symbols makes the answer clear.

A puzzle where people or objects must be placed in a line or around a circle according to given clues. Careful use of fixed positions and elimination solves these questions.

A reasoning topic where a word or sentence is written in a code according to some rule, and the candidate must find the rule or decode a new word using it.

A word that has the same or nearly the same meaning as another word in the same language. For example, 'abundant' and 'plentiful' are synonyms.

A word whose meaning is opposite to that of another word. For example, 'scarce' is an antonym of 'abundant'.

A fixed expression whose meaning cannot be worked out from the individual words, such as 'to bite the bullet' meaning to face a difficult situation bravely.