NABARD Grade A key terms

The interest rate at which the Reserve Bank of India lends short-term funds to commercial banks against government securities. Raising it drains liquidity and cools inflation; cutting it stimulates credit and growth.

The rate at which the RBI absorbs surplus liquidity from banks by borrowing against securities. It sits below the repo rate and forms the floor of the liquidity adjustment corridor.

The share of net demand and time liabilities that scheduled banks must hold as cash balances with the RBI. It earns no interest and directly reduces the funds available for lending.

The minimum percentage of net demand and time liabilities that a bank must hold in cash, gold, or approved government securities. It is a prudential and liquidity tool set by the RBI.

A six-member body chaired by the RBI Governor that sets the benchmark policy rate to meet a flexible inflation target of four percent, with a tolerance band of plus or minus two percent.

A mandate requiring banks to direct a specified share of credit, generally forty percent of adjusted net bank credit, to agriculture, micro enterprises, education, housing, and weaker sections.

A scheme giving farmers a revolving credit line for crop inputs, drawn through a card and passbook. It covers short-term needs and has been extended to dairy and fisheries activities.

A government support mechanism that reimburses lenders so that short-term crop loans are charged a lower effective interest rate, with an additional prompt-repayment incentive for timely payers.

A risk-transfer arrangement compensating farmers for yield or weather losses. India's flagship scheme is the Pradhan Mantri Fasal Bima Yojana, with low farmer premiums shared between centre and state.

A floor price announced by the government before sowing for specified crops, intended to protect farmers from sharp price falls. Procurement agencies buy at or above this level.

A state-regulated wholesale market body that oversees trading of notified farm produce, charges market fees, and licenses commission agents. Reforms aim to allow trade outside these yards.

An arrangement where a buyer agrees in advance to purchase a farmer's produce at agreed quality and price terms, often supplying inputs and technical guidance during cultivation.

A small voluntary group of poor households, usually ten to twenty women, that pools savings and lends internally before graduating to bank credit. It is a core vehicle of financial inclusion.

A group of four to ten borrowers who guarantee each other's loans without collateral, commonly used by microfinance institutions to extend small credit to rural clients.

Provision of small loans, savings, and insurance services to low-income households that lack formal collateral, typically delivered through groups and specialised institutions.

Ensuring that individuals and small businesses have access to affordable, usable financial services such as savings accounts, credit, insurance, and payments, rather than merely a bank account.

A national mission launched in 2014 to open basic savings accounts with overdraft and insurance benefits for unbanked households, forming the base of direct benefit transfers.

A mechanism that credits government subsidies and welfare payments directly into beneficiaries' bank accounts, reducing leakage and duplicate claims through identity verification.

Niche banks licensed in India that accept deposits and offer payments but cannot lend or issue credit cards. They must hold a large share of deposits in government securities.

Licensed banks focused on underserved segments, required to hold a high share of loans as small-ticket advances and priority sector lending, while offering full banking services.

A loan on which principal or interest has remained overdue for more than ninety days. Such assets must be classified as substandard, doubtful, or loss and provisioned accordingly.

Gross non-performing assets expressed as a percentage of gross advances. It is a headline indicator of asset quality in a bank's balance sheet.

A 2016 Indian law creating time-bound resolution of insolvent firms through a committee of creditors and a professional resolution professional, with liquidation as a last resort.

The gap between total government expenditure and total receipts excluding borrowings, expressed as a share of GDP. It measures how much the government must borrow to fund spending.

The excess of revenue expenditure over revenue receipts. It shows borrowing used for day-to-day consumption rather than asset creation, so it is watched closely for quality of spending.

A sustained reduction in the fiscal deficit and public debt over time through higher revenue, expenditure restraint, or both, aimed at macroeconomic stability and lower borrowing costs.

The Fiscal Responsibility and Budget Management Act, 2003, which sets targets for deficit reduction and requires the government to present medium-term fiscal policy statements to Parliament.

A retail price index tracking the cost of a fixed basket of goods and services bought by households. India uses CPI-Combined as the headline measure for inflation targeting.

A measure of price change at the wholesale or producer level, covering primary articles, fuel, and manufactured products. It excludes services and is not the RBI's target measure.

A systematic record of all economic transactions between residents of a country and the rest of the world, comprising the current account, capital account, and errors and omissions.

The excess of a country's payments for imports of goods, services, and transfers over its receipts from exports and remittances. It must be financed by capital inflows or reserves.

Assets held by the central bank in foreign currencies, gold, and reserve positions with the IMF, used to defend the currency and meet external obligations.

A payment service allowing a bank customer to transact using Aadhaar number and biometric authentication at a business correspondent point, without a card or PIN.

An interoperable real-time payment system built on the Immediate Payment Service that lets users send and receive money across banks using a virtual payment address.

An electronic funds transfer system for one-to-one credit transfers between bank accounts in India, settled through the RBI's structured batch processing.

A system where interbank payments are settled individually and immediately in central bank money, used mainly for high-value and time-critical transactions.

System software that manages hardware resources, schedules processes, handles memory and files, and provides services that application programs rely on to run.

A network security control that inspects incoming and outgoing traffic and permits or blocks it according to configured rules, protecting a private network from unauthorised access.

A social engineering attack that impersonates a trusted entity through email, messages, or fake websites to trick a user into revealing passwords, card details, or one-time passwords.

A login method requiring two independent proofs of identity, such as a password plus a one-time code, so that a stolen password alone cannot grant access.