Maharashtra HSC Vocational BFSI cheat sheet

A bank accepts demand deposits repayable on demand and time deposits repayable after a fixed period; the spread between lending and deposit rates is the core source of net interest income.

RBI classifies banks into scheduled (listed in the Second Schedule of the RBI Act, 1934) and non-scheduled banks; scheduled status requires paid-up capital and reserves of at least ₹5 lakh and satisfaction of RBI.

Banking Regulation Act, 1935 Section 5(b) defines banking as accepting, for the purpose of lending or investment, deposits of money from the public, repayable on demand or otherwise.

Types of banks: commercial (public, private, foreign, regional rural), cooperative (urban and rural), payments banks (deposits up to ₹2 lakh, no lending), and small finance banks (75% priority-sector lending).

NBFCs lend and invest but cannot accept demand deposits and are not part of the payment and settlement system; they are regulated by RBI under the RBI Act Chapter IIIB.

Financial inclusion instruments: Pradhan Mantri Jan Dhan Yojana basic savings account, Business Correspondent model, and Direct Benefit Transfer through Aadhaar-linked accounts.

CRR is the share of net demand and time liabilities kept as cash with RBI; SLR is the share held in approved securities such as government bonds; both are set by RBI.

Money market deals in instruments up to one year (call money, T-bills, commercial paper, certificates of deposit); capital market deals in longer-term equity and debt.

KYC requires identity and address proof plus risk categorisation (low, medium, high); periodic re-KYC is triggered by risk category, and Politically Exposed Persons need enhanced due diligence.

A cheque is valid for three months from its date; a stale cheque (older) or post-dated cheque is not payable on presentation until the date arrives.

Crossing a cheque (two parallel lines) means payment only through a bank account; a general crossing cannot be cashed at the counter, while an account-payee crossing restricts credit to the named account.

A cheque is dishonoured for insufficient funds under Section 138 of the Negotiable Instruments Act, 1881; the payee must issue a legal notice within 30 days of receiving the return memo.

NEFT settles in batches, RTGS settles in real time for transactions of ₹2 lakh and above, and IMPS is available 24x7 through mobile banking for smaller amounts.

Loan appraisal checks the 5 Cs: character, capacity, capital, collateral and conditions; a sanction letter states amount, rate, tenure, margin and repayment schedule.

A non-performing asset is a loan where interest or principal is overdue more than 90 days; substandard, doubtful and loss assets are the further classifications.

A locker is a safe custody service under a rental agreement, not a bailment of contents; the bank is not liable for loss of valuables unless negligence is proved.

Insurance transfers risk from the insured to the insurer in exchange for a premium; it works on the principle of pooling of risks and the law of large numbers.

Insurable interest means the insured must benefit from the continued existence of the subject and suffer loss from its destruction; it must exist at the time of the contract for life insurance and at the time of loss for general insurance.

Utmost good faith (uberrimae fidei) requires full and honest disclosure of material facts; non-disclosure or misrepresentation can make a policy voidable.

Indemnity restores the insured to the pre-loss financial position and applies to general insurance, not to life insurance, which is a benefit contract.

Subrogation transfers the insured's right of recovery from a third party to the insurer after claim payment; contribution shares a loss among insurers when multiple policies cover the same risk.

Life insurance products: term plan (pure risk cover, no maturity value), endowment (cover plus savings), whole life, money-back, ULIP (market-linked with lock-in of five years), and annuity for pension.

General insurance products: fire, marine, motor (third-party cover is mandatory under the Motor Vehicles Act), health, crop and personal accident.

IRDAI regulates insurers and intermediaries; a policyholder has a 15-day free-look period for life insurance and 30 days for distance marketing to return the policy.

Primary market is where new securities are issued (IPO, FPO, rights issue, private placement); secondary market is where existing securities trade on exchanges such as NSE and BSE.

SEBI regulates the securities market; its functions include protecting investors, regulating intermediaries, and promoting development of the market.

Treasury bills are zero-coupon money market instruments issued by the government at a discount and redeemed at face value; they mature in 91, 182 or 364 days.

Commercial paper is an unsecured promissory note issued by corporates with a minimum denomination of ₹5 lakh and maturity up to one year.

A bond's price moves inversely to interest rates; yield to maturity equates the present value of future coupons and principal to the current price.

Equity shares give ownership, voting rights and dividends; preference shares give a fixed dividend and priority over equity on liquidation but usually no voting rights.

Mutual funds pool investor money under SEBI regulations; NAV = (total assets minus total liabilities) divided by number of units outstanding.

Derivatives such as futures and options derive value from an underlying asset; a futures contract obliges both parties, while an option gives the buyer a right without obligation.

Service quality is measured on reliability, responsiveness, assurance, empathy and tangibles (the SERVQUAL five dimensions); reliability is the most important to customers.

A complaint must be acknowledged and resolved within the bank's internal timeline; if unresolved within 30 days, the customer may approach the RBI Integrated Ombudsman Scheme, 2021.

The Banking Ombudsman award is binding on the bank if the customer accepts it in writing within 30 days; the customer may appeal to the appellate authority.

KYC-compliant account opening, standing instructions and nomination are routine service tasks; a nomination is mandatory to be offered and can be changed by the account holder at any time.

Sales in BFSI must follow suitability and need analysis: match product risk and tenure to the customer's profile and disclose all charges, penalties and lock-ins before sale.

Cross-selling and up-selling are permitted only with informed consent; mis-selling (e.g., selling insurance as a fixed deposit) is a regulatory violation.

A customer's data is confidential; sharing it requires consent except where law or regulation (e.g., tax reporting, court order) mandates disclosure.

Effective complaint handling uses the LAST model: listen, apologise, solve, thank; escalation matrix and turnaround times should be communicated to the customer.

Accounting equation: Assets = Liabilities + Owner's Equity; every transaction keeps this equation balanced under double-entry bookkeeping.

Debit increases assets and expenses; credit increases liabilities, equity and income; each entry has an equal and opposite effect.

Golden rules: debit the receiver and credit the giver (personal accounts); debit what comes in and credit what goes out (real accounts); debit expenses and losses, credit incomes and gains (nominal accounts).

Balance sheet reports assets, liabilities and equity at a point in time; the income statement reports revenue and expenses over a period.

Gross profit = Sales − Cost of Goods Sold; net profit = Gross profit − operating expenses − interest − tax.

Current ratio = Current assets ÷ Current liabilities; a ratio around 2:1 is conventionally treated as comfortable liquidity.

Simple interest = P × R × T ÷ 100; compound interest = P(1 + R/100)^T − P; EMI depends on principal, rate and tenure.

Financial literacy covers budgeting, saving, borrowing cost awareness, insurance protection and fraud avoidance; the RBI's financial education initiative is the National Centre for Financial Education.

RBI Act, 1934 establishes RBI as the central bank; Banking Regulation Act, 1949 governs banking business; both empower RBI to license and supervise banks.

RBI's key functions: monetary policy, currency issuance (except one-rupee coins and notes, which are the Government of India's), banker to government, lender of last resort, and foreign exchange management under FEMA.

The Prevention of Money Laundering Act, 2002 requires reporting entities to maintain KYC records, report suspicious and cash transactions, and retain records for the prescribed period.

FEMA governs foreign exchange transactions; current account transactions are generally free, while capital account transactions are regulated.

The Consumer Protection Act, 2019 and RBI's fair practices code protect customers against unfair terms and deficiency in service.

Ethical conduct in BFSI covers integrity, confidentiality, conflict-of-interest disclosure, fair dealing and refusal of bribery; insider trading is prohibited under SEBI regulations.

The Right to Information Act, 2005 applies to public sector banks; private banks are not public authorities under the Act.

Whistleblower protection and the bank's code of conduct require employees to report fraud or misconduct to the appropriate authority rather than conceal it.

A resume for BFSI roles should state measurable achievements (e.g., 'handled 60 customer queries a day') rather than duties, and list relevant certifications such as NISM or IRDAI agent licence.

A cover letter follows a three-paragraph structure: role and source, evidence of fit, and call to action; it should be one page and tailored to the job description.

Group discussion assessment uses content, communication, listening and leadership; interrupting and dominating reduce the score.

Interview preparation uses the STAR method: Situation, Task, Action, Result, to answer behavioural questions concisely.

Banking practical skills include cash handling and tallying, cheque verification, account opening forms, passbook printing, and using core banking and CRM software.

Digital skills expected: UPI and NEFT/RTGS processing, internet banking operations, spreadsheet use for reconciliation, and awareness of cyber-fraud red flags such as phishing links.

Workplace etiquette: punctuality, dress code, data confidentiality, escalation of errors, and accurate record-keeping; errors must be reported immediately, not hidden.

Career paths in BFSI: probationary officer, clerk/customer service executive, relationship manager, insurance advisor, mutual fund distributor, and back-office operations executive.