RBSE Prav Voc BFSI flashcards

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

BFSI

Umbrella acronym covering Banking, Financial Services and Insurance: the four pillars are banks, NBFCs and other financial institutions, insurance companies and capital-market players such as brokers and mutual funds.

NBFC

Non-Banking Financial Company: a company registered with RBI that lends or invests but cannot accept demand deposits and is not part of the payment and settlement system.

Payments bank

A differentiated bank licensed by RBI that accepts deposits up to a prescribed per-customer limit and issues debit cards, but cannot lend or issue credit cards.

Regional Rural Bank

A bank set up under the RRB Act 1976 with shareholding by the central government, state government and a sponsor bank, to serve rural and semi-urban customers.

CASA ratio

Current Account Savings Account ratio: low-cost current and savings deposits divided by total deposits, a key driver of a bank's cost of funds and profitability.

Cash Reserve Ratio

The share of net demand and time liabilities that a bank must hold as cash with RBI; it earns no interest and reduces the funds available for lending.

EMI

Equated Monthly Instalment: the fixed monthly payment repaying both principal and interest, computed as P×r×(1+r)^n divided by ((1+r)^n − 1).

Non-Performing Asset

A loan where interest or principal is overdue for more than 90 days; it is classified as substandard, doubtful or loss depending on how long it stays overdue.

UPI

Unified Payments Interface: an NPCI-operated instant payment system that lets users send money 24x7 using a virtual payment address linked to a bank account.

RTGS

Real Time Gross Settlement: RBI's system for high-value individual fund transfers settled in real time, with a minimum transaction value of two lakh rupees and no upper ceiling.

Tokenisation

Replacing a card number with a unique alternate token stored on a device or with a merchant, so that actual card details are never shared during a transaction.

AePS

Aadhaar Enabled Payment System: a bank-led model allowing cash withdrawal and balance enquiry at business correspondent points using Aadhaar number and fingerprint authentication.

Primary market

The segment where a company issues new securities to investors through an IPO, FPO or rights issue, and the money raised goes directly to the issuer.

Treasury bill

A short-term money-market instrument issued by the government at a discount to face value with maturities of 91, 182 or 364 days and no coupon payment.

Sensex

The S&P BSE Sensitive Index, a free-float market-capitalisation weighted index of major companies listed on the Bombay Stock Exchange, widely used as a market barometer.

Demat account

An account with NSDL or CDSL that holds securities in electronic form, required for buying, selling and holding shares without physical certificates.

Insurable interest

The legal and financial relationship a policyholder must have in the subject matter of insurance, such as owning a vehicle or depending on a person's life.

Principle of indemnity

The rule that a general insurance claim restores the insured to the financial position held before the loss, without allowing the insured to profit from the claim.

Free look period

A window of about 30 days after receiving a life insurance policy during which the policyholder may cancel it and receive a refund of premium less charges.

Subrogation

After paying a claim, the insurer takes over the insured's legal right to recover the loss from the third party responsible for causing it.

Accounting equation

Assets equal Liabilities plus Owner's Equity; this balance must be preserved by every transaction and is the structure on which the balance sheet is built.

Trial balance

A statement listing all ledger balances on a given date, used to check that total debits equal total credits before final accounts are prepared.

Depreciation

The systematic allocation of the cost of a fixed asset over its useful life, recorded as an expense in the profit and loss account each year.

Compound interest

Interest calculated on the principal plus previously earned interest, using P(1+r/n)^(nt) minus P, so the amount grows faster than under simple interest.

Cross-selling

Offering an additional related product to an existing customer, for example a debit card or insurance policy to a customer opening a savings account.

RATER model

A service-quality framework scoring Reliability, Assurance, Tangibles, Empathy and Responsiveness; banks use it to measure and improve customer experience.

Customer lifetime value

The total net profit a customer is expected to generate over the entire relationship, used to decide how much to invest in acquisition and retention.

Customer Due Diligence

Identifying the customer, verifying identity and address, and understanding the purpose of the account before starting the relationship, with periodic updates based on risk.

Suspicious Transaction Report

A confidential report a bank files with the Financial Intelligence Unit about a transaction it suspects involves proceeds of crime, regardless of the amount.

Phishing

A fraud where attackers send fake emails or messages with copycat links or websites to trick customers into revealing passwords, card numbers or OTPs.

Udyam registration

The free online registration for micro, small and medium enterprises on the government portal, which issues an MSME certificate used for loans and scheme benefits.

STAR method

A way to answer interview questions by describing the Situation, Task, Action taken and Result achieved, giving concise evidence of a candidate's competence.