MCQ
Centralised Payment System MCQ - Practice Questions with Answers
Solve 100 Centralised Payment System questions for RAS/RPSC preparation.
Practice questions
Q1Consider the following statements about the application process for CPS membership: 1. Applications for CPS membership are submitted to the Chief General Manager, Department of Payment and Settlement Systems, RBI Central Office. 2. The application is submitted in the format prescribed in Appendix 1, Covering letter for membership to Centralised Payment System, together with annexures. 3. RBI endeavours to scrutinise complete applications within 60 days of receipt. 4. On approval, the non-bank entity gets a letter of approval valid for one year, within which it must ensure participation in CPS. Which of the statements given above are correct?
Statements 1, 2 and 3 are correct. Applications go to the CGM, DPSS, RBI Central Office; the Appendix 1 format is prescribed; and RBI aims to scrutinise complete applications within 60 days. Statement 4 is false because the approval letter is valid for six months, not one year.
Q2Consider the following statements about eligibility criteria for non-bank PSP access to CPS: 1. A valid Certificate of Authorisation from RBI under the Payment and Settlement Systems Act, 2007 is required. 2. A net worth of Rs. 10 crore is the RBI criterion for CPS access by non-bank PSPs. 3. Compliance with local payment data storage requirements issued by RBI is one of the criteria. Which of the statements given above are correct?
Statements 1 and 3 are correct. RBI requires a valid Certificate of Authorisation under the PSS Act and compliance with local payment data storage requirements. Statement 2 is incorrect because the criterion is net worth of Rs. 25 crore or as prescribed as per the certificate of authorisation, whichever is higher.
Q3Consider the following statements about the application approval stage for non-bank CPS access: 1. On approval, DPSS, Central Office issues a letter of approval to the non-bank entity. 2. The approval letter is valid for six months, within which the entity must ensure participation in CPS. 3. The approval letter is valid for one year in the first instance. Which of the statements given above are correct?
Statements 1 and 2 are correct: approval is issued by DPSS, Central Office and is valid for six months. Statement 3 is false because the initial approval is not valid for one year.
Q4Consider the following statements about RTGS and NEFT processing: 1. RTGS stands for Real Time Gross Settlement. 2. In RTGS, settlement instructions are processed individually without netting. 3. NEFT, like RTGS, processes transactions continuously on a transaction-by-transaction basis throughout the day. Which of the statements given above are correct?
Statements 1 and 2 are true: RBI explains RTGS as Real Time Gross Settlement with individual transaction-by-transaction settlement without netting. Statement 3 is false because RBI contrasts NEFT batch processing with RTGS continuous processing.
Q5Consider the following statements about Centralised Payment Systems in India: 1. RTGS and NEFT are Centralised Payment Systems owned and operated by the Reserve Bank of India. 2. NEFT operates in 48 half-hourly batches on a 24x7x365 basis. 3. RTGS transactions have no floor value for the amount transferred. Which of the statements given above are correct?
Statement 1 is correct: RBI identifies RTGS and NEFT as CPS owned and operated by it. Statement 2 is correct: the RBI FAQ says NEFT operates in 48 half-hourly batches 24x7x365. Statement 3 is incorrect: RTGS has a floor value of Rs. 2 lakh, so it is not a no-floor-value system.
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6Consider the following statements about non-bank Payment System Providers directly participating in CPS: 1. They may sponsor other banks or PSPs as sub-members in CPS. 2. They are eligible for Intra-Day Liquidity facility from the Reserve Bank. 3. They need not maintain liquidity support arrangements with their bankers. Which of the statements given above are correct?
7Consider the following statements about direct access to Centralised Payment Systems by non-banks: 1. Direct access includes allotment of a separate Indian Financial System Code. 2. Direct access includes opening a current account with the Reserve Bank in e-Kuber. 3. Direct access makes non-bank PSPs eligible for Intra-Day Liquidity from the Reserve Bank. 4. Direct access includes INFINET membership and use of SFMS to communicate with CPS. Which of the statements given above are correct?
8Consider the following statements about customer-facing RTGS rules: 1. The minimum amount to be remitted through RTGS is Rs 2 lakh, with no upper ceiling. 2. RBI waived processing charges levied by it for RTGS transactions with effect from July 1, 2019. 3. Beneficiary banks are expected to credit RTGS funds within two hours of receiving the funds transfer message. 4. The UTR number in RTGS is a 22-character code. Which of the statements given above are correct?
9Consider the following statements about RTGS: 1. Because RTGS settlement takes place in the books of RBI, the payments are final and irrevocable. 2. RBI has set no upper or maximum ceiling for RTGS transactions. 3. RTGS is available 24x7x365 with effect from December 14, 2020. 4. The minimum amount to be remitted through RTGS is Rs. 50,000. Which of the statements given above are correct?
10Consider the following statements about the transaction scope and supervision of non-bank CPS members: 1. RTGS enables participants to initiate and receive payments for inter-bank, non-bank and customer transactions. 2. NEFT membership is relevant to all non-bank PSP categories, including card networks and white label ATM operators. 3. In the CPS-access context, MNSB transactions are relevant for card networks only. 4. Supervisory assessments for authorised non-bank PSPs directly participating in CPS include compliance with Master Directions on Access to Payment Systems, RTGS System Regulations and NEFT Procedural Guidelines. Which of the statements given above are correct?
11Consider the following statements about Pay Point India Network's entry into RBI's CPS: 1. Pay Point India Network became the first private fintech firm to gain direct membership of RBI's Centralised Payment System. 2. The firm was assigned its own IFSC code and maintains both current and settlement accounts with RBI. 3. The membership made Pay Point India dependent on partner banks for RTGS and NEFT access. 4. NPCI and CCIL were already existing direct members, while SEBI is a securities regulator and is unrelated to CPS membership. Which of the statements given above are correct?
12Consider the following statements about RTGS settlement: 1. RTGS processes fund-transfer instructions continuously and in real time. 2. RTGS settlement is gross settlement, meaning that instructions settle individually without netting. 3. RTGS payments are final and irrevocable because funds settlement takes place in RBI's books. Which of the statements given above are correct?
13Consider the following statements about Centralised Payment Systems in India: 1. RTGS and NEFT are Centralised Payment Systems owned and operated by the Reserve Bank of India. 2. RTGS is a large-value payment system and was introduced in March 2004. 3. NEFT was introduced in November 2004. Which of the statements given above are correct?
14Consider the following statements about IFSC in NEFT: 1. IFSC is an alphanumeric code that uniquely identifies a bank branch participating in NEFT. 2. IFSC is a 10-digit code whose fifth character is 1. 3. IFSC is used by NEFT to identify originating and destination bank branches and to route messages. Which of the statements given above are correct?
15Consider the following statements about applying for direct CPS membership: 1. Applications are submitted to the Chief General Manager, Department of Payment and Settlement Systems, RBI Central Office. 2. The application is submitted in Appendix 2, meant for decentralised payment system membership. 3. RBI endeavours to scrutinise complete applications within 60 days of receipt. Which of the statements given above are correct?