Paper II · Part B — Economics

Banking and the Reserve Bank of India

Exam-focused notes, visual explanation, traps, revision sheet and every mapped past NDA question.

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Core4 mapped NDA questions

Build the idea

Build exam-ready understanding by connecting the core idea, formulas or facts, worked example and previous NDA questions. Focus on why each rule works, then test it under timed conditions.

Concept

Banks accept deposits and lend money, channelling savings into investment. The Reserve Bank of India (RBI) is the central bank that regulates the banking system and issues currency.

The RBI controls money supply through monetary policy.

Key Points & Formulas

RBI established in 1935; it is the central bank and issues currency (except coins).
RBI is the 'banker's bank' and lender of last resort.
Monetary tools: repo rate, reverse repo rate, CRR, SLR.
Commercial banks create credit through lending.

Worked Example

Q. What happens to borrowing when the RBI raises the repo rate?

The repo rate is the rate at which the RBI lends to banks.

A higher repo rate makes borrowing costlier for banks and customers.

This reduces borrowing and helps control inflation.

Common traps

Reading the prompt too quickly and missing a qualifier.
Memorising the result without checking when it applies.
Skipping units, signs, chronology or the final reasonableness check.

NDA shortcuts

State the governing rule before substituting values.
Eliminate impossible options before doing full calculation.

One-screen revision sheet

Recall before you practise

Core definition
Most-used rule
One representative example

Past-paper bank

Practise every mapped question

Filter by year

4 NDA questions

Choose an answer before the solution appears. Option order is mixed automatically.

Question 1

NDA II 2023

Which one of the following is the name of the dashboard launched recently by the Reserve Bank of India to assess and monitor the progress of financial inclusion by capturing relevant parameters?

Question 2

NDA II 2016

As per the RBI guidelines, which one of the following is the minimum tenure of Masala Bonds that an Indian company can issue offshore?

Question 3

NDA II 2020

The Five Year Plan was first launched in

Question 4

NDA II 2020

Match List I (Major Objective) with List II (Five Year Plan):

| List I (Major Objective) | List II (Five Year Plan) |
|---|---|
| A. Faster and more inclusive growth | 1. First |
| B. Faster, more inclusive and sustainable growth | 2. Fifth |
| C. Correction of disequilibrium caused by Second World War | 3. Eleventh |
| D. Attaining self-reliance | 4. Twelfth |

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