Banker-Customer Relationship and Digital Banking

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Questions and Answers

What is the primary function of a collecting banker?

To collect and process customer cheques (correct)

To manage the bank's real estate investments

To sell bank shares to investors

To provide loans directly to customers

Which of the following is NOT a precaution that a banker should take when handling payments?

Monitoring for signs of fraud

Verifying customer identity

Ensuring sufficient funds are available

Fulfilling customer requests without question (correct)

What does a CIBIL score primarily assess?

The interest rates for savings accounts

The risk of bank fraud

The amount of bank deposits a customer has

The creditworthiness of an individual (correct)

Which type of loan is secured by collateral?

Secured loans Signup and view all the answers

What is one major benefit of CASA deposits for banks?

Stable funding for lending Signup and view all the answers

Which of the following describes a hidden charge in the context of loans?

Fees that are not clearly outlined prior to loan approval Signup and view all the answers

What does the term 'wrongful dishonor of cheque' refer to?

Refusing to honor a cheque without just reason Signup and view all the answers

What does annualized percentage rate (APR) refer to?

The yearly interest rate expressed as a percentage Signup and view all the answers

What is the primary purpose of understanding the Banker's Customer relationship?

To explain the rights and responsibilities of both parties Signup and view all the answers

Which of the following is NOT a right of the banker in the customer relationship?

Right to seize collateral without notice Signup and view all the answers

What aspect of digital banking is highlighted in the provided content?

Cyber fraud is a significant concern in digital banking Signup and view all the answers

What is a key component of the BCBF model for financial inclusion?

Facilitating overdraft and debit card facilities Signup and view all the answers

Which of these is an essential aspect of digital banking mentioned in the content?

Types of Electronic Fund Transfer Systems Signup and view all the answers

What rights do bankers hold concerning a customer's cheque?

The right to process cheques only if compliant with banking regulations Signup and view all the answers

Why is financial literacy important in the context of the BCBF model?

It aids in understanding financial products and services Signup and view all the answers

Which type of digital banking service is explicitly mentioned in the content?

Payment Wallet services Signup and view all the answers

Study Notes

Banker and Customer Relationship

Defines what a banker is and their relationship with their customers
Discusses the legal relationship between a banker and customer
Covers situations where a banker may act as a borrower
Explains the difference between debt owed to a banker versus an ordinary commercial debt
Outlines the rights of a banker, including lien and set-off rights
Explains the right of bankers to charge interest and commission
Emphasizes the obligation of bankers to maintain the secrecy of customer accounts
Covers procedures for closing bank accounts, stopping payments, and garnishee orders

Digital Banking

Explains the meaning of digital banking
Defines the key elements of digital banking
Examines the state of digital banking in India
Discusses various cyber security threats and frauds
Addresses different types of Electronic Fund Transfer Systems
Covers Point of Sale systems (POS) and digital wallets
Provides information on kiosks and the National Payments Corporation of India (NPCI)
Discusses the history and products of NPCI, including UPI, NACH, and BHIM

Financial Inclusion Through the BCBF model

Emphasizes the need for financial literacy and inclusion
Introduces the Bank Correspondent (BC)/Business Facilitator (BF) model
Discusses how the BCBF model promotes financial inclusion
Explains the scope of BC/BF activities, including overdraft facilities, debit cards, and insurance
Highlights the role of BCs/BFs in financial inclusion

Payments and Collection of Customer Cheques

Discusses precautions for handling payments
Explains payments in due course and the situations where a banker can refuse payment
Covers the concept of wrongful dishonor of a cheque
Explains the process of countermanding payments of cheques and drafts
Discusses the protection afforded to paying bankers
Explores the banker's role as a holder for value
Analyzes the responsibilities of a collecting banker and their customers
Explains the duties of a collecting banker and the protection given to them

Loan and Advances

Defines loan and advance
Explores the principles of sound lending
Discusses various forms of advances
Differentiates secured and unsecured loans
Covers hidden charges and the Annualized Percentage Rate (APR)
Introduces Key Fact Statements (KFSs) and the CIBIL Score
Explains CIBIL Score’s importance to banks and its role in loan approval
Provides guidance on reading a CIBIL report, understanding good and bad CIBIL scores, and different CIBIL Score series

CASA Deposits

Defines Current Account (CA) and Savings Account (SA) deposits – CASA deposits
Explains the importance of CASA deposits to banks
Discusses transaction services and channels offered by banks to CASA account holders
Covers the benefits of CASA deposits for customers
Provides insights into the features of CASA deposits

Practical Problems

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Description

This quiz covers the essential aspects of the relationship between bankers and customers, including legal definitions, rights, and obligations. Additionally, it explores the realm of digital banking, discussing its key features, security threats, and the latest developments in India. Test your understanding of these critical banking concepts.