PSEB SS NSQF BFSI (BC/BF) key terms

A mandatory process in which a bank verifies a customer's identity, address and source of funds before opening an account or allowing transactions, in order to prevent fraud, money laundering and terrorist financing.

The set of laws, rules and internal procedures a financial institution follows to detect and report attempts to disguise the origin of illegally obtained money, including monitoring transactions and filing reports with authorities.

The ongoing process of gathering and updating information about a customer's identity, business, risk profile and expected transaction pattern, so the bank understands who it is dealing with at all times.

A confidential written report a bank files with the financial intelligence unit when a transaction appears unusual or has no clear economic purpose and may involve criminal proceeds.

A ten-character permanent account number issued by the Income Tax Department to an individual or entity, used as the primary identity and tax document for opening accounts and for high-value transactions.

A deposit account such as savings or current from which the customer may withdraw money at any time without prior notice, usually through cheque, ATM, card or electronic transfer.

A demand deposit account meant for businesses and professionals, offering unlimited transactions and no interest, with overdraft facility available subject to the bank's approval.

A deposit account for individuals that earns interest on the balance and allows limited free withdrawals per month, typically restricted to personal and household use rather than business.

A term deposit in which money is locked with the bank for a chosen period at an agreed interest rate, with premature withdrawal allowed only after a penalty or reduced rate.

A deposit scheme in which the customer pays a fixed amount every month for a chosen tenure and receives the total deposits plus interest on maturity.

A facility by which a depositor names a person who will receive the balance of the account or deposit in case of the depositor's death, avoiding lengthy succession formalities.

A negotiable instrument drawn on a bank, ordering it to pay a stated sum from the drawer's account to a named payee or bearer on demand.

A prepaid instrument issued by a bank branch, drawn on another branch or bank, guaranteeing payment of a specified amount to a named payee on demand.

A signature and instruction written on the back of a cheque or other negotiable instrument by the holder to transfer the right to receive payment to another person.

The interbank process by which cheques and other payment instruments presented by one bank are exchanged and settled, resulting in credit or debit to the customer's account.

National Electronic Funds Transfer, a central bank operated system for transferring funds between bank accounts in India, processed in batches at fixed intervals throughout the day.

Real Time Gross Settlement, a system in which large-value fund transfers are settled one by one and immediately, without netting, and cannot be reversed once processed.

Immediate Payment Service, a round-the-clock instant interbank funds transfer system operated in India, usable through mobile banking, internet banking and ATMs.

Unified Payments Interface, a mobile platform that links bank accounts to a virtual payment address so users can send and receive money instantly using a smartphone app.

A short alphanumeric identifier, such as a name followed by a bank handle, that a UPI user shares instead of account number and IFSC to receive payments.

Indian Financial System Code, an eleven-character code that uniquely identifies a bank branch in electronic payment systems, with the first four letters naming the bank.

A facility permitting a customer to withdraw more than the available balance in a current account up to an approved limit, with interest charged on the amount actually used.

A working capital facility in which a borrower draws funds up to a sanctioned limit against hypothecation of stock or receivables, paying interest only on the amount drawn.

A charge created when a borrower pledges movable assets such as stock or vehicles as security for a loan while retaining possession and use of those assets.

A legal charge over immovable property, such as land or a house, created in favour of a lender as security for a loan, giving the lender a right to sell on default.

The proportion of the value of a property or asset that a lender is willing to finance, expressed as loan amount divided by the asset's appraised value.

A fixed payment made by a borrower to a lender every month, comprising both interest and principal, structured so the loan is fully repaid by the end of the tenure.

Interest calculated only on the original principal amount for the period, without adding accumulated interest to the base, computed as principal times rate times time divided by one hundred.

Interest calculated on the principal plus any interest already earned, so the amount grows faster than with simple interest over the same period and rate.

A small booklet or printed statement issued to a deposit customer recording deposits, withdrawals and balances, used to reconcile the customer's records with the bank's ledger.

The process of comparing two sets of records, such as a pass book and bank ledger, to confirm that they agree and to locate any difference requiring correction.

A statement listing all ledger account balances at a given date, with debits and credits in separate columns, used to test whether total debits equal total credits.

A system of accounting in which every transaction is recorded in at least two accounts, one debit and one credit of equal amount, keeping the books in balance.

A scheme providing farmers with a revolving credit facility for crop production and allied needs, issued as a card with a sanctioned limit and simplified renewal.

A regulatory requirement obliging banks to direct a specified minimum share of their lending to sectors such as agriculture, small enterprises, education and weaker sections.

Provision of small loans, savings and insurance services to low-income households and tiny businesses that lack access to mainstream banking, often through self-help groups.

An independent authority appointed to receive and settle customer complaints against banks that have not been resolved by the bank's own grievance redressal mechanism within the prescribed time.

A safe deposit box rented by a bank to a customer for storing valuables, operated with a key supplied to the customer and subject to the bank's allotment and operation rules.