Banking Sector in India: UPSC Previous Year Questions (Indian Economy)
2 previous year UPSC Prelims questions on Banking Sector in India (Indian Economy). Choose an option to see the answer and explanation.
Explanations state facts as of the year each question was asked; words like “recently” refer to that year.
Showing 1–2 of 2 questions
UPSC 1998Indian Economy · Banking Sector in India
Q1. The banks are required to maintain a certain ratio between their cash in hand and total assets. This is called:
Explanation
The Statutory Liquidity Ratio (SLR) is the minimum percentage of a bank’s net demand and time liabilities (NDTL) that it must maintain in the form of liquid assets such as cash, gold, or government-approved securities. This requirement ensures that banks have sufficient liquidity to meet withdrawal demands and maintain financial stability. The Re-serve Bank of India (RBI) sets and regulates the SLR to control the expansion of bank credit and ensure the solvency of banks. As of December 6, 2024, the SLR is set at 18%. The RBI has the authority to adjust this rate as part of its monetary policy toolkit.
UPSC 1998Indian Economy · Banking Sector in India
Q2. The accounting year of the Reserve Bank of India is:
Explanation
As of 1998, the Reserve Bank of India (RBI) operated on an accounting year spanning from July to June. This system had been in place since March 11, 1940, when the RBI transitioned its accounting period from January-December to July-June. However, in 2020, the RBI decided to align its accounting year with the Government of India’s fiscal year, which runs from April to March. This change was implemented to enhance the effectiveness of monetary policy and fiscal operations. Consequently, the accounting year 2020-21 was a transitional period of nine months, from July 2020 to March 2021. Subsequently, from April 2021 onwards, the RBI adopted the April-March accounting cycle
Answer key for these questions
Q
UPSC year
Correct answer
1
1998
(b) SLR (Statutory Liquid Ratio)
2
1998
(b) July-June
Frequently asked questions
How many previous year UPSC questions are there on Banking Sector in India?
This page covers 2 previous year UPSC Prelims GS Paper-I questions on Banking Sector in India (Indian Economy), asked from 1997 to 2025. Each has the correct answer and an explanation.
How should I use previous year UPSC questions for Prelims?
Attempt each question first, then open the answer and read the explanation for every option. Repeat by chapter, and track which statements UPSC reuses across years. Previous year questions show the exam pattern and difficulty level.
Which years are covered for Banking Sector in India?
Questions on Banking Sector in India (Indian Economy) are available for 24 years, from 1997 to 2025. Use the Year filter to practise a single paper.
