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Banking Lending & Investment Interview Questions

  1. What do you understand by lending?
    Ans: Lending means giving loans for varied purposes for different people, who are in need of funds.

  2. Why should banks lend?
    Ans: Major source of funds for banks are deposits which are borrowed from public. Banks have to earn for payment of interest to depositors.

  3. What type of loans are given to agriculturist?
    Ans: Crop Loans.

  4. Crop loans are sanctioned for what purpose?
    Ans: To purchase seeds, land preperation, to meet cost of fertilizers, pesticides and for cost of labor.

  5. What other loans are available to farmers?
    Ans: To purchase land, Tractors, pumpsets and digging wells.

  6. Do you know something about priority sectors?
    Ans: Priority sectors are decided by GOI and communicated through RBI to banks. These include agriculture, micro, small and medium enterprises (MSME).

  7. What is micro credit?
    Ans: Providing credit upto Rs.50000 /- to small borrowers.

  8. What do you understand by financial inclusion?
    Ans: Financial inclusion means, extension of financial services to the rural or semi urban poor at affordable costs, who hitherto are excluded.

  9. What are BPL families
    Ans: Families living below poverty lines.

  10. What is poverty line?
    Ans: Povertyline is determined basing on per capita income and consumption of food.

  11. Who decides BPL?
    Ans: Based on recommendation by planning commission the Ministry of Finance decides the BPL.

  12. What is the majot problem banks are facing now?
    Ans: According to me, the mounting levels Non performing assets (NPAs).

  13. What is NPA (Non performing asset)?
    Ans: If a borrower fails to pay interest or installment within 90 days from due date, then the asset is known as NPA.

  14. What steps are being taken by banks for recovery of NPAs?
    Ans: Apart from traditional procedures, One Time Settlement, recovery through agents, enforcement agencies and lok adalats were the steps taken by banks for recovery of NPAs.

  15. What are "NO Frills" accounts?
    Ans: No frills accounts are opened with zero balances.

  16. How do banks get money to pay interests on deposits?
    Ans: The money collected on deposits will be issued as loans to people with higher rate of interest. Banks arrange the credit structure to maximize their profits.

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