Recent

  • Show all results for ""
Currency Distribution Exchange Scheme Overview
37 Questions
0 Views

Currency Distribution Exchange Scheme Overview

Created by
@PreciseConceptualArt

Questions and Answers

What is the service charge levied by the currency chest on non-chest branches for large modern Current Chests?

  • ₹10/- per 100 pieces
  • ₹8/- per 100 pieces (correct)
  • ₹5/- per 100 pieces
  • ₹7/- per 100 pieces

    • What should banks do to ensure a steady supply of coins for distribution?

  • Maintain a minimum stock of three bags of coins in all denominations
  • Limit coin distribution to only large clients
  • Stock only the most frequently used coin denominations
  • Maintain a minimum stock of one bag of coins in each denomination (correct)

    • How should banks incentivize the distribution of coins by their BCs?

  • By limiting the distribution to high-value transactions
  • By using only digital distribution methods
  • By offering cash bonuses to all employees
  • By implementing a rewards program as per the board approved policy (correct)

    • What is one responsibility of senior officers during visits to currency chests and branches?

    <p>To specifically comment on the implementation of coin distribution measures</p> Signup and view all the answers

    What is the service charge applicable for non-chest branches dealing with other Currency Chests?

    <p>₹5/- per 100 pieces</p> Signup and view all the answers

    What should not be required for banks to receive incentives for certain transactions?

    <p>Submission of a separate claim</p> Signup and view all the answers

    What frequency of verification is required for the implementation of coin distribution measures?

    <p>Bi-monthly and half-yearly</p> Signup and view all the answers

    On what basis will currency chest branches pass on incentives to linked branches/chests?

    <p>Pro-rata basis based on specific transactions</p> Signup and view all the answers

    What is the main objective of the Currency Distribution and Exchange Scheme (CDES)?

    <p>To encourage better customer services in banks</p> Signup and view all the answers

    What percentage of capital expenditure is eligible for reimbursement for opening currency chests in underbanked states?

    <p>50%</p> Signup and view all the answers

    What is the maximum ceiling for capital expenditure reimbursement per currency chest?

    <p>₹50 lakh</p> Signup and view all the answers

    How long are banks reimbursed for revenue expenditures under the CDES?

    <p>For the first 3 years</p> Signup and view all the answers

    In the North Eastern region, what is the reimbursement rate for capital expenditure on currency chests?

    <p>100%</p> Signup and view all the answers

    Which regulatory act is associated with the issuance of guidelines for the Clean Note Policy?

    <p>RBI Act, 1934</p> Signup and view all the answers

    What is the objective of the Clean Note Policy?

    <p>To improve the condition of physical currency</p> Signup and view all the answers

    What is one of the key features of the CDES incentives?

    <p>Incentives include both capital and revenue cost reimbursements</p> Signup and view all the answers

    What is the penalty for shortages in soiled note remittances for denominations up to ₹ 50?

    <p>₹ 50 per piece in addition to the loss</p> Signup and view all the answers

    What percentage penalty is imposed on counterfeit notes detected in soiled note remittances?

    <p>100% of the notional value</p> Signup and view all the answers

    What is the penalty amount for mutilated notes in soiled note remittances, regardless of denomination?

    <p>₹ 50 per piece in addition to the loss</p> Signup and view all the answers

    How is the penalty for penalties associated with counterfeit notes determined?

    <p>Based on the notional value of the note</p> Signup and view all the answers

    What actions trigger a penalty for deficit in currency chest balances?

    <p>Immediate detection of any shortage</p> Signup and view all the answers

    What percentage of revenue expenditure is eligible for reimbursement in the North Eastern region for the first five years?

    <p>50%</p> Signup and view all the answers

    What is the fee charged for the exchange of soiled notes per packet for denominations up to ₹50?

    <p>₹2</p> Signup and view all the answers

    What is the fee for adjudicating a mutilated note per piece?

    <p>₹2</p> Signup and view all the answers

    How much is paid per bag for the distribution of coins?

    <p>₹65</p> Signup and view all the answers

    What additional incentive is provided for coin distribution in rural and semi-urban areas?

    <p>₹10 per bag</p> Signup and view all the answers

    What document is required to obtain the additional incentive for coin distribution?

    <p>Concurrent Auditor certificate</p> Signup and view all the answers

    How is the incentive for coin distribution based on withdrawals determined?

    <p>Net withdrawal from currency chest</p> Signup and view all the answers

    What is the reimbursement eligibility for revenue expenditure in the North Eastern region after the first five years?

    <p>Zero percent</p> Signup and view all the answers

    Who is the Competent Authority to decide the nature of irregularity related to a defaulting currency chest?

    <p>The Officer-in-Charge of the Issue Department</p> Signup and view all the answers

    What is the time frame in which an appeal against the Competent Authority's decision must be made?

    <p>Within one month from the date of debit</p> Signup and view all the answers

    What penalty is imposed for cash-out at any ATM for more than ten hours in a month?

    <p>₹ 10,000 per ATM</p> Signup and view all the answers

    Which entity is responsible for administering the Scheme of Penalty for non-replenishment of ATMs?

    <p>The Issue Departments of the Regional Offices</p> Signup and view all the answers

    On what grounds will appeals for waiver of penalty not be considered?

    <p>New or untrained staff</p> Signup and view all the answers

    In the case of White Label ATMs (WLAs), who is liable for the penalty imposed for non-replenishment?

    <p>The bank which supplied the cash</p> Signup and view all the answers

    What must banks submit to the Issue Department regarding ATM downtime?

    <p>System generated statement on downtime</p> Signup and view all the answers

    Who has the authority to impose penalties related to non-replenishment of ATMs?

    <p>The Officer-in-Charge of the Issue Department</p> Signup and view all the answers

    Study Notes

    Currency Distribution & Exchange Scheme (CDES)

    • Established by RBI under Section 45 of the RBI Act, 1934 and Section 35 A of the Banking Regulation Act, 1949.
    • Aims to promote Clean Note Policy and enhance public service through better currency management.
    • Incentives provided to banks for setting up infrastructure and facilitating exchange of notes and coins.

    Financial Incentives for Banks

    • Currency Chests:

      • 50% reimbursement of capital costs for branches in underbanked states, capped at ₹50 lakh per chest.
      • In the North Eastern region, up to 100% reimbursement for costs capped at ₹50 lakh.
      • 50% reimbursement of revenue costs for the first 3 years; 5 years in the North Eastern region.

    • Exchange of Soiled and Mutilated Notes:

      • ₹2 per packet for soiled notes up to ₹50 denomination.
      • ₹2 per piece for adjudication of mutilated notes.

    • Distribution of Coins:

      • Incentive of ₹65 per bag distributed, plus an extra ₹10 for distribution in rural and semi-urban areas.
      • Payments based on net withdrawals from currency chests.

    • Cash Deposits by Non-Chest Branches:

      • Service charge of ₹8 per 100 pieces for large modern currency chests; ₹5 for others, excluding applicable service tax.

    Operational Guidelines

    • No separate claims required for banks; incentives passed on to linked branches on a pro-rata basis.
    • Banks encouraged to engage Business Correspondents (BCs) to facilitate coin distribution.
    • Each branch should maintain a minimum stock of one bag of coins per denomination.

    Penalties for Deficiencies in Service

    • Shortages in Soiled Note Remittances:

      • Penalty of ₹50 per soiled note up to ₹50 denomination; value of denomination for ₹100 and above.
      • Equal to the denomination value for coins for any shortfall.

    • Counterfeit Notes:

      • 100% penalty on the notional value of counterfeit notes detected.

    • Mutilated Notes:

      • ₹50 penalty per piece, irrespective of denomination, in addition to loss incurred.

    • Competent Authority for determining irregularities is the Officer-in-Charge of the Regional Office.

    • Appeals against penalties can be made; however, excuses such as staff inexperience will not be considered valid.

    ATM Non-Replenishment Penalty

    • Instituted from October 1, 2021, to ensure cash availability in ATMs.
    • Cash-out penalties of ₹10,000 per ATM for over 10 hours of downtime monthly.
    • White Label ATMs penalized at the bank fulfilling the cash requirement; banks may recover penalties from WLA operators.
    • System-generated statements on ATM downtime must be submitted to the Issue Department of RBI.

    Studying That Suits You

    Use AI to generate personalized quizzes and flashcards to suit your learning preferences.

    Quiz Team

    Description

    Explore the guidelines and objectives of the Currency Distribution and Exchange Scheme (CDES) as established by the RBI under the Clean Note Policy. This quiz will enhance your understanding of currency management and the regulatory framework set in place for bank branches and currency chests.

    More Quizzes Like This

    British Currency and Money Management Quiz
    5 questions

    British Currency and Money Management Quiz

    BreathtakingBlueTourmaline avatar
    BreathtakingBlueTourmaline
    RBI Act and Branch Setup Process Quiz
    6 questions

    RBI Act and Branch Setup Process Quiz

    FasterHarpGuitar avatar
    FasterHarpGuitar
    Management of Foreign Currency Transactions
    10 questions

    Management of Foreign Currency Transactions

    QuaintForest7033 avatar
    QuaintForest7033
    Currency Management Guidelines Quiz
    8 questions

    Currency Management Guidelines Quiz

    PreciseConceptualArt avatar
    PreciseConceptualArt
    Use Quizgecko on...
    Browser
    Open
    Browser
    Browser