Download Sample Question Paper Solved of “Banking – Code 811” for Class 12 NSQF Vocational, CBSE Session 2021-2022.

Banking (Subject Code – 811)

Sample Question Paper Solved of “Banking” for Class 12 Session 2019-2020
Max. Time: 3 Hours Max. Marks: 60

Section A: Objective Type Questions
Q. 1 Answer. any 4 out of the given 6 questions on Employability Skills (1 x 4 = 4 marks)

i. Mention a source of motivation and inspiration for the workers and management in banking sector.
ii. Mention any two role of green jobs in water conservation for banks and financial institutions.
iii. Name the software which can be used by the bank manager to present his records to the higher authorities.
iv. Banker should develop _________ Skills in order to express effectively with maximum efficiency.
v. Body language of any employees in bank is _______ type of communication.
vi. ________ are the individual pages of a presentation.

Q. 2 Answer. any 5 out of the given 7 questions (1 x 5 = 5 marks)

i. Which is the safest cheque from the receiver point of view?
a) Account Payee cheque
b) Bearer Cheque
c) Crossed Cheque
d) Demand Draft

ii. What is maximum limit for an NEFT transfer per transaction?
a) No Limit
b) 1 lakh
c) 2 lakhs
d) 3 lakhs

iii. Which is the fastest mode of payment?
a) Credit card
b) RTGS
c) NEFT
d) Cheque

iv. Letter of Credit (LC) is irrevocable ___________provided by the Bank, it safe guards the interest of both importer and exporter during international trade.

v. ATM stands for
a) Any Time Money
b) Automated Teller Machine
c) Automobile Trending Machine
d) None of the above

vi. Which part of the Bank is known as the revenue generator?
a) Front Office
b) Middle Office
c) Back Office
d) None of the above

vii. In absence of RBI branch in a particular city, which Bank acts as the clearing house?
a) PNB
b) ICICI Bank
c) SBI
d) Canara Bank

Q. 3 Answer. any 6 out of the given 7 questions (1 x 6 = 6 marks)

i. IFSC code has _______ no. of characters.
ii. Full form of MICR is ______________________.
iii. In case of funded credit facility, the money moves out of the Bank when ________.
iv. Officers holding keys to the Drill door of the vault are called vault __________.
v. When a fixed deposit matures, Bank credits _____________ to the account.
a) Interest only
b) Principal only
c) Neither Principal nor Interest
d) Principal plus Interest

vi. Loan given by the Bank is shown as ______________.

a) Income
b) Expense
c) Liability
d) Asset

vii. Balance sheet is also known as _________ statement.
a) Income
b) Expense
c) Financial Position
d) Creative

Q. 4 Answer. any 5 out of the given 6 questions (1 x 5 = 5 marks)

i. Full form of SMS is _____________.
ii. CBS helps in customer convenience through _____ and _____Banking.
iii. __________ office manages the risks for the Bank.
iv. A ______________is a secure space where Money, Valuables, Records and Documents are stored.
v. In case of floating rate loan, Borrower will benefit if the ______
a) Interest rate remains constant
b) Interest rate in the future is higher
c) Interest rate in the future is lower
d) Interest rate has no bearing
vi. In case of overdraft account, interest is charged only on the __________ balance.

Q. 5 Answer. any 5 out of the given 6 questions (1 x 5 = 5 marks)

i. What is the full form of OTP?
ii. What is the expanded form of DSA?
iii. AML stands for ___________________.
iv. the date on which the payment of the bill is due is called due date and it is calculated by adding ________to the period of bill called days of grace.
v. __________is the minimum interest rate of a Bank below which it cannot lend, except in cases allowed by RBI.
vi. The basic function of a bank is to accept ________and give out loans.

Q. 6 Answer. any 5 out of the given 6 questions (1 x 5 = 5 marks)

i. Write the expanded form of IDBI.
ii. Which of the following is safer for RBI when lending to Banks?
a) Loan Transaction
b) Loan against collateral
c) Repo /Reverse Repo transaction
d) Cash / Stock Lending & Borrowing
iii. The standard rate at which RBI is prepared to buy or rediscount bills of exchange or other eligible commercial paper from other Banks:
a) Bank Rate
b) Prime Lending Rate
c) Repo Rate
d) Base Rate
iv. Buying and selling of eligible securities by ____________bank in the money market is known as open market operations.
v. In a bank’s accounting, all transactions “debit or credit” are documented by______.
vi. Bills for Collection appears on both the sides of the______________.

Section B: Subjective Type Questions

Answer. any 3 out of the given 5 questions on Employability Skills (2 x 3 = 6 marks)
Answer. each question in 20 – 30 words.

Q. 7 Communication skills help the bank employees to improve the customer satisfaction. Do you agree with the statement? Give reason.
Q. 8 Why self- motivation is important for banking sector? Give two reasons.
Q. 9 Define presentation. How can a bank cashier/probationary officer present his records in front of higher authorities?
Q. 10 How recycling materials helps the banking industry to grow economically? Explain.
Q. 11 How listening skills may help the bank employees as well as organization?

Answer. any 3 out of the given 5 questions in 20 – 30 words each (2 x 3 = 6 marks)

Q. 12 State any two disadvantages of selling third party products by the banks.
Q. 13 “Banks have various channels to transfer money from one person to another”. What are the different ways to transfer money electronically from one person to another? Explain any one in brief
Q. 14 Write any two features of proving loan by bank at fixed rate of interest.
Q. 15 State any two objectives of SLR.
Q. 16 Explain Phishing as one of the online banking risks.

Answer. any 2 out of the given 3 questions in 30– 50 words each (3 x 2 = 6 marks)

Q. 17 Why Core Banking Solution is needed? (Any three points brief explanation required)
Q. 18 State any three functions performed by the banks other than accepting deposits and lending money which are fruitful to their customers.
Q. 19 There is 60% increase in an amount in 6 years at simple interest. What will be the compound interest of RS 12,000 after 3 years at the same rate? Show working clearly.
a) RS 2160
b) RS 3120
c) RS 3972
d) None of these

Answer. any 3 out of the given 5 questions in 50– 80 words each (4 x 3 = 12 marks)

Q. 20 Write any four points of differences between Banker’s Cheque and Demand Draft.
Q. 21 “Back offices provide many administrative and support services to the front office of a bank”. What are the functions performed by the back offices in a bank? (Any four)
Q. 22 Name any four and explain any two factors affecting market rates of interest.
Q. 23 Explain in brief:
a) Bank Rate
b) Repo Rate
Q. 24 What are the different kind of assets generally a bank can indicate in its Balance sheet? Name them.

Answers

Section A: Objective Type Questions

Q. 1 Answer. any 4 out of the given 6 questions on Employability Skills (1 x 4 = 4 marks)

i. sources of motivation and inspiration are:
a) Books,
b) Activities,
c) Dreaming big etc.
(Any one)

ii. jobs in water conservation are; Water treatment specialist. Water Auditor Water policy Analyst Water resource planning manager Water Quality Monitoring Water conservation Representative

iii. Power point presentation
iv. Interpersonal
v. Non Verbal
vi. Slides

Q. 2 Answer. any 5 out of the given 7 questions (1 x 5 = 5 marks)

i. d) Demand Draft
ii. a) No limit
iii. b) RTGS
iv. Commitment
v. b) Automated Teller Machine
vi. a) Front Office
vii. c) SBI

Q. 3 Answer. any 6 out of the given 7 questions (1 x 6 = 6 marks)

i. 11
ii. Magnetic Ink Character Recognition.
iii. Approved
iv. Custodian
v. d) Principal plus Interest
vi. d) Asset
vii. c) Financial Position

Q. 4 Answer. any 5 out of the given 6 questions (1 x 5 = 5 marks)
i. Short Message Service
ii. Anywhere, Anytime
iii. Middle
iv. Bank vault
v. c) Interest rate in the future is lower
vi. Overdrawn

Q. 5 Answer. any 5 out of the given 6 questions (1 x 5 = 5 marks)
i. OTP -One time password
ii. DSA-Direct Sales Agents
iii. Anti-Money Laundering
iv. 3 days
v. Base Rate
vi. Deposits

Q. 6 Answer. any 5 out of the given 6 questions (1 x 5 = 5 marks)
i. IDBI – Industrial Development Bank of India
ii. c) Repo /Reverse Repo transaction
iii. a) Bank Rate
iv. Central
v. Vouchers
vi. Balance Sheet

Section B: Subjective Type Questions

Answer. any 3 out of the given 5 questions on Employability Skills (2 x 3 = 6 marks)
Answer. each question in 20 – 30 words.

Q. 7 True
any valid reason required

Q. 8 Self-motivation is important because
It increases individual‟s energy and activity.
It directs an individual towards specific goals.
It results in initiation and persistence of specific activities, thus keeps him/her active.
It affects cognitive processes and learning strategies used by individual for completing similar tasks.
Any two reasons

Q. 9 He/she may present a number of slides containing text, graphics, movies, sound, and graphs. Slides of a presentation can be displayed one by one on the screen in front of management.

Q. 10 Recycling materials helps the environment by reducing wastages and improves the efficiency too. Valid explanation in 30 words required.

Q. 11 Listening skills helps the employees to
1. Understand the concept and
2. The instructions provided to them
3. Which reduces wastages and improves quality of work i.e. profitability can be increased.

Answer. any 3 out of the given 5 questions in 20 – 30 words each (2 x 3 = 6 marks)

Q. 12 i) Banks offering wealth management services are exposed to reputational risks on account of miss-selling of products & conflict of interest. (State any two)
ii) Lack of knowledge and clarity on products
iii) Front line staff at banks may be more interested in pushing insurance and para-banking products instead of promoting core banking products.
iv)Staffs may be untrained to the job and do not take responsibility of the outcome in any manner.

Q. 13 a) NEFT
b) RTGS
Brief explanation of any one

Q. 14 (1 X2 = 2 Marks)
When the rate of interest applied to a loan remains constant and unchanged from the beginning till the maturity of the loan it is called “Fixed Rate of Interest‟.
Interest rate remains fixed irrespective of market conditions.
The borrower or the depositor has peace of mind.
The uncertainty is removed, Thus it brings a sense of Certainty and security.

Q. 15 Any two (1 X 2 = 2 Marks)
i) To restrict the expAns.ion of Bank’s limit
ii) To increase Bank’s investment in approved securities
iii) To ensure solvency of Banks

Q. 16 Phishing: Phishing is the Centre stage of Internet Scams. Phishing is the way of sending emails at arbitrary, indicating to come from a candid company which is operating on the internet. When the customers make an attempt, its request disclosing information at a bogus website will be operated by them. Information entered on the bogus website is captured by the criminals and they use it for their own purpose.

Answer. any 2 out of the given 3 questions in 30– 50 words each (3 x 2 = 6 marks)

Q. 17 Improve operational efficiency – reduce cost of operations:
Core Banking will provide various alternative delivery service channels, which reduce cost and time taken for the transactions. The centralised process of core banking will also improve efficiency by avoiding duplication of work in posting entries from Branch Office (BO) to Head office and vice versa.
Improve customer service:
Core Banking will improve customer services by providing services through alternate channels on 24 x 7 basis –ATM, Internet, Phone, SMS and Mobile Banking. Customers would be able to operate their accounts, and avail banking services from any branch on CBS network, regardless of where they maintain their account.
Comply with Anti Money Laundering (AML) /Know Your Customer (KYC) requirements:
It is easy to comply with anti–money laundering norms through core banking. The AML norms require the Banks to detect when a customer has opened multiple accounts. ( 1 Mark for each point)

Q. 18 i) Issue Letters of Credit/Guarantees on behalf of its customers;
ii) Rent out Safe Deposit Lockers to its customers and allow them to operate the lockers;
iii) Sell Third Party Products (TPPs) like Insurance products and Mutual Fund units to its customers.
iv) Accept cheques / drafts from their customers in their favour, for collection and credit to their deposit accounts;
v)Issue of drafts on outstation locations as required by customers; (1 X3 = 3 Marks)

Q. 19 a) RS 2160
b) RS 3120
c) RS 3972
d) None of these
2 Marks to show working
Let P = RS 100. Then, S.I. RS 60 and T = 6 years.
R =
100 x 60
= 10% p.a. 100 x 6
Now, P = RS 12000. T = 3 years and R = 10% p.a.
C.I. = RS 12000 x 1 +
10 3
– 1
100
= RS 12000 x
331
1000
c) RS 3972. 1 Mark

Answer. any 3 out of the given 5 questions in 50– 80 words each (4 x 3 = 12 marks)

Q. 20 Key Differences between Banker’s Cheque and Demand Draft (Any four) 1 Mark for each point of difference
i) Banker‟s Cheque is issued for transfer of money within the local limits of the drawer branch, whereas Demand Draft is issued for transferring money to a person residing at a different place.
ii) The area of banker‟s cheque is limited while the area of demand draft is very vast.
iii) The banker‟s cheque is pre-printed with the word “Not Negotiable” however, this is not so in case of demand draft.
iv) A demand draft of value Rs. 20,000 or more can be issued only with a/c payee crossing, however in case of banker‟s cheque there is no such condition.
v) Banker‟s cheque can only be cleared in the branch of bank from where it is issued, but Demand Draft can be cleared at any branch of the same bank.

Q. 21 Functions of the Back office: The functions carried out by the Back office are:
1. Sending statements to clients on mail and at the addresses provided if required.
2. Resolving clients‟ queries
3. Processing clients‟ standing instructions
4. Checking and Opening Clients‟ accounts as per the details provided.
5. Issuance of cheque books to clients
6. Cheque clearing
7. Positioning for all Bank products viz. cheques, cards, personal loan, mortgage
loan etc. (Any for)

Q. 22 i) Opportunity cost,
ii) Inflation,
iii) Borrower‟s default,
iv) Length of time etc………… ½ Mark each ½ X 4 = 2 Marks)
Explanation of any two 1 X2 = 2 Marks
Opportunity cost: Opportunity cost refers to any other use to which the money could be put, for example lending to others or investing elsewhere. If one can get a higher return elsewhere, the interest rate on loAns. will also rise.

Inflation: Simply put, inflation is the movement in prices in % per annum terms.
Usually prices move only upwards. For example, now if you can buy some articles for RS 100 and after one year you require RS 110 to purchase similar articles, then the inflation is 10%. Since the lender is postponing his consumption now to use it later, he will require as a bare minimum compensation to recover enough to make up for the inflation and plus something more as an incentive. Because future inflation is unknown, the lender will always add some „premium‟ to the expected inflation rate and demand that as his interest rate.
Demand and supply: Demand for and supplies of money are the crucial factors in determining the interest rates.

Borrower Default: There is always the risk that the borrower will become bankrupt, abscond or otherwise default in repaying the loan. In order to limit the bad consequences of such situations, the lender usually adds some „risk premium‟ to the interest rate already decided and quotes such rates to the borrower.

Length of time: Shorter terms are less risky from the point of view of default and exposure to inflation because the near future is easier to predict. In these circumstances, short term interest rates are lower than longer term interest rates.
Government intervention: Government’s and RBI‟s actions may also influence short-term interest rates.

Q. 23 a) Bank rate: is the standard rate at which RBI is prepared to buy or rediscount bills of exchange or other eligible commercial paper from Banks.
It is basic rate of rediscounting and refinance facilities from RBI Change in Bank rate by RBI affects interest rates on the Loans., and Deposits across the board in the same direction. Hence, increase in Bank rate will increase the interest rates on the Loans. /Deposits and vice versa. (2 Marks)
b) Repo Rate: Reserve Bank of India lends funds to the commercial banks under its Liquidity Adjustment Facility to meet their short term needs of funds. The rate at which banks borrow short-term funds from RBI is called Repo Rate. Such funds are provided on the promise of repurchase of approved securities by banks. Thus there are two legs in the Repo Transaction Process. Banks facing a shortage of funds can borrow from RBI through a repo transaction. (2 Marks)

Q. 24 1. Cash
a. Cash on hand
b. Cash with central bank and other banks
2. Money at call and short notice
3. Bills discounted
4. Bills for collection
5. Investments
6. Loans and advances
7. Acceptances and endorsement
8. Fixed assets