JAIIB RBWM flashcards

32 cards. Read the term and the definition here. The deck at the top of this page is optional.

CRR maintenance requirement

Banks must maintain a minimum 90% of the required CRR on the first day of the fortnight and 100% on every day of the fortnight, based on NDTL.

EMI formula

EMI = P × r × (1+r)^n / ((1+r)^n − 1), where P is principal, r is monthly interest rate, and n is the number of instalments.

BSBDA-Small Account limits

A small account allows aggregate credits up to ₹2 lakh per year and a maximum balance of ₹10,000, with no minimum balance requirement; it is opened using Aadhaar OTP-based e-KYC.

CTS cheque truncation

Cheque Truncation System captures the cheque image and MICR data electronically; the physical cheque does not move to the paying bank, and the image is legally admissible under Section 81A of the NI Act.

UPI transaction limit

The standard UPI transaction limit is ₹1 lakh per transaction; specific categories like capital markets and insurance have higher limits; UPI Lite allows offline small-value payments up to ₹1,000 per transaction.

NPA classification

A loan becomes a Non-Performing Asset when interest or principal is overdue for more than 90 days; sub-standard assets are NPAs up to 12 months, and doubtful assets are NPAs beyond 12 months.

KYC periodic updation

Under RBI's KYC Master Direction, high-risk customers require periodic KYC updation every 2 years, medium-risk every 8 years, and low-risk every 10 years.

Positive Pay System

For cheques of ₹5 lakh and above, the account holder must furnish cheque details to the bank, which verifies them before payment; non-compliance may lead to return of the cheque.

LTV ratio for home loans

RBI prescribes LTV limits for home loans: up to ₹30 lakh - 90%; ₹30–75 lakh - 80%; above ₹75 lakh - 75%. LTV is the loan amount divided by property value.

RTGS minimum amount

RTGS is meant for high-value transactions with a minimum of ₹2 lakh; it operates 24×7 with real-time settlement, and there is no upper limit.

Section 138 NI Act

Dishonour of a cheque for insufficient funds is punishable with imprisonment up to 2 years or fine up to twice the cheque amount, or both, after a 30-day demand notice.

CIBIL score range

CIBIL score ranges from 300 to 900; a score of 750 or above is generally considered good and is based on repayment history, credit utilisation, credit age, and enquiries.

MSME classification

Micro: investment up to ₹2.5 crore and turnover up to ₹10 crore; Small: up to ₹25 crore and ₹100 crore; Medium: up to ₹125 crore and ₹500 crore.

AePS withdrawal limit

Aadhaar Enabled Payment System allows a customer to withdraw up to ₹10,000 per day through a Business Correspondent using Aadhaar number and biometric authentication.

Zero liability in fraud

A customer has zero liability for unauthorised electronic transactions if the fraud is due to bank negligence and is reported within 3 working days; limited liability applies for 4–7 days.

Priority Sector Lending target

Domestic scheduled commercial banks must lend 40% of Adjusted Net Bank Credit to priority sectors, including sub-targets of 18% for agriculture and 7.5% for micro enterprises.

DSCR

Debt Service Coverage Ratio = Net Operating Income / Total Debt Service; a ratio of 1.5 or above is typically preferred for commercial lending.

Senior citizen FD benefit

Senior citizens (age 60+) are eligible for higher fixed deposit rates as per bank policy; under Section 80TTB, interest income up to ₹50,000 per year is deductible.

SARFAESI enforcement

Under the SARFAESI Act, 2002, a secured creditor can enforce security interest without court intervention after a 60-day notice, provided the loan is classified as an NPA.

IMPS limit

Immediate Payment Service is available 24×7 with a maximum limit of ₹5 lakh per transaction; it uses mobile number and MMID or account number and IFSC.

Nomination in deposits

Nomination under Section 45ZA of the Banking Regulation Act, 1949 is mandatory for new deposit accounts; a nominee can be changed any number of times.

Ombudsman compensation limit

The RBI Ombudsman may award compensation up to ₹2 lakh for loss of time, expenses, and harassment, in addition to the amount involved in the complaint.

Mudra loan categories

Pradhan Mantri Mudra Yojana: Shishu up to ₹50,000; Kishore ₹50,001 to ₹5 lakh; Tarun ₹5 lakh to ₹10 lakh; Tarun Plus up to ₹20 lakh for eligible borrowers.

Card tokenisation

Card tokenisation replaces sensitive card data with a unique token for online transactions; it is mandatory for merchants since October 2022, and the token is device-specific.

Savings interest calculation

Interest on savings deposits is calculated on the daily closing balance method and must be credited at least quarterly; the rate is deregulated for commercial banks.

Recurring deposit maturity

Recurring deposit interest is compounded quarterly; maturity value = P × [((1+r/400)^(4n) − 1)/(r/400)] × (1+r/400), where P is monthly deposit, r annual rate, n years.

Digital lending guidelines

RBI's Digital Lending Guidelines require all loan disbursals and repayments to be executed directly between the bank and borrower, with no pass-through accounts and full disclosure by LSPs.

Fixed vs floating rate

In a fixed-rate loan, the EMI remains constant; in a floating-rate loan, the interest rate resets with the benchmark, and the EMI or tenure adjusts accordingly.

PEP definition

A Politically Exposed Person is an individual entrusted with prominent public functions; PEPs are always classified as high-risk customers and require enhanced due diligence.

NEFT settlement

NEFT operates 24×7 in half-hourly batches; it is suitable for low-value transfers and has no minimum or maximum limit, though banks may set their own caps.

Two-factor authentication

Two-factor authentication is mandatory for all electronic banking transactions; for card-not-present transactions, the second factor can be a PIN, OTP, or biometric.

CBDC nature

CBDC (Digital Rupee) is a legal tender issued by RBI in digital form; it is a sovereign currency, not a cryptocurrency, and is exchangeable with physical currency at par.