Class 10 Banking Mock Test (ICSE)

Topics in Banking

• Central bank and its functions
• Internet banking and mobile banking
• NEFT, RTGS and IMPS
• Financial fraudulent practices and safeguards

Banking practice questions with answers

1. Q1Multiple choice·1 mark
   What is the term used for a fraudulent practice where scammers make phone calls impersonating bank officials to trick customers into disclosing sensitive information such as OTPs, PINs, or passwords?

   1. (a)Vishing
   2. (b)Shoulder surfing
   3. (c)Skimming
   4. (d)Pharming
   Show answer and step marks

   1. Correct option: (a) Vishing (voice phishing) involves telephone calls made by fraudsters to manipulate victims into revealing confidential credentials.+1

   Answer: (a)
2. Q2Multiple choice·1 mark
   Which of the following best describes the 'lender of last resort' function performed by the Central Bank?

   1. (a)Managing day-to-day cash counters for public deposits
   2. (b)Fixing retail interest rates on individual savings accounts
   3. (c)Providing emergency financial accommodation to commercial banks facing temporary liquidity shortages
   4. (d)Issuing currency notes directly to retail citizens
   Show answer and step marks

   1. Correct option: (c)+1

   Answer: (c)
3. Q3Multiple choice·1 mark
   Which of the following security features is standard for safeguarding mobile banking applications against unauthorized access?

   1. (a)Remembered-device login that keeps the app signed in on the phone
   2. (b)Long and complex password reused for both email and banking apps
   3. (c)SMS alerts sent to the registered mobile number after each transaction
   4. (d)Multi-factor authentication including biometric verification
   Show answer and step marks

   1. Correct option: (d) Multi-factor authentication including biometric verification. It needs two or more independent proofs of identity (such as a PIN plus a fingerprint), so a stolen phone or a leaked password alone cannot open the account.+1

   Answer: (d)
4. Q4Multiple choice·1 mark
   Which of the following institutions acts as the banker, agent, and financial adviser to the Government in India?

   1. (a)Reserve Bank of India
   2. (b)State Bank of India
   3. (c)Ministry of Finance
   4. (d)National Bank for Agriculture and Rural Development (NABARD)
   Show answer and step marks

   1. Correct option: (a) Reserve Bank of India, which performs banking operations for the government, manages public debt, and provides financial advice.+1

   Answer: (a)
5. Q5Short answer·2 marks
   Distinguish between NEFT (National Electronic Funds Transfer) and RTGS (Real Time Gross Settlement) systems on the basis of their settlement processing and minimum transaction limits.
   Show answer and step marks

   1. Settlement processing: NEFT settles transactions in batches at half-hourly intervals (48 batches a day, round the clock), whereas RTGS settles each transaction individually, in real time and on a gross basis.+1
   2. Minimum transaction limit: NEFT has no minimum amount, whereas RTGS requires a minimum transaction amount of ₹ $2,00,000$.+1

   Answer: NEFT settles in half-hourly batches and has no minimum amount; RTGS settles each transaction individually in real time and has a minimum of ₹ $2,00,000$.
6. Q6Long answer·4 marks
   (a) Explain any two financial fraudulent practices commonly encountered in digital banking, other than phone-based impersonation calls. (b) State any two precautionary measures or safeguards that bank customers must adopt to ensure safe electronic banking transactions.
   Show answer and step marks

   1. (a) First fraud explained, any one of: phishing (fake e-mails, SMS or websites imitating a bank to steal login details); card skimming or cloning (copying card data with a device fixed to an ATM or POS machine); SIM-swap fraud (getting a duplicate SIM to receive the victim's OTPs); fake UPI collect requests or QR codes that debit money when the victim enters the UPI PIN; malware or screen-sharing apps that capture banking credentials; or any other valid digital banking fraud other than impersonation calls.+1
   2. (a) Second fraud explained, a different one from the same list.+1
   3. (b) First safeguard, any one of: never share the PIN, password, OTP, UPI PIN or CVV with anyone; use only the bank's official app or secure (https) website and do not click unsolicited links; enable SMS or e-mail transaction alerts and report unauthorised debits at once; avoid banking on public Wi-Fi or shared computers; change passwords regularly and log out after every session; or any other valid safeguard.+1
   4. (b) Second safeguard, a different one from the same list.+1

   Answer: (a) Any two of: phishing, card skimming or cloning, SIM-swap fraud, fake UPI collect requests or QR codes, malware or screen-sharing apps, each briefly explained. (b) Any two of: never share PIN, password, OTP, UPI PIN or CVV; use only the official app or a secure https site and avoid suspicious links; enable transaction alerts and report unauthorised debits; avoid public Wi-Fi; change passwords regularly and log out.

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