Re-KYC frequency depends on the customer's risk category — high-risk customers are typically reviewed more often (for example annually) than low-risk customers, per RBI's risk-based approach.
A circular typically announces a specific change, while a Master Direction consolidates all current instructions on a subject into a single, updated reference document.
For loans linked to an external benchmark or a bank's repo-linked lending rate, a repo rate hike typically feeds through to a higher lending rate over time, which can increase EMIs or loan tenure depending on the loan structure.
Credit risk is generally the largest for most commercial banks, since lending is their core activity, though market and operational risk can become dominant concerns for banks with large trading books or complex technology operations.
No — an STR is meant to flag transactions that appear suspicious or inconsistent with normal patterns for further investigation; the bank does not need to prove wrongdoing before reporting.
No. Compliance works proactively to ensure ongoing adherence to regulations, while internal audit independently and periodically tests whether that adherence is actually happening — the two functions are related but organisationally distinct.
Cheque dishonour due to insufficient funds can attract criminal liability for the drawer under Section 138 of the Negotiable Instruments Act, in addition to any civil recovery action, provided the statutory notice and complaint procedure is followed.
No — interest earned on savings and most deposit accounts is generally outside the scope of GST, since GST applies to fee-based services rather than to interest income itself.
No — TDS is only a deduction at source against your eventual tax liability. You still need to report total interest income in your income tax return and settle any additional tax due, or claim a refund if TDS deducted exceeds your actual liability.
No — the bank typically acts as a distributor; the actual investment is held with the mutual fund/asset management company through a registrar, and its value fluctuates with market performance independent of the bank's own balance sheet.
No — term insurance is pure protection with no savings or investment component, which is why its premiums are typically much lower than investment-linked life insurance products for the same cover amount.
A PEP is an individual who holds or has held a prominent public function, such as a senior government or judicial official, and is therefore considered higher risk for corruption-related money laundering.
The RBI publishes all circulars and notifications on its official website (rbi.org.in) — always treat that as the authoritative source over any secondary summary.
CRR and SLR directly affect the quantity of funds available for banks to lend, while the repo rate affects the price (cost) of short-term borrowing — RBI uses a combination of tools depending on whether it wants to manage liquidity, rates, or both.
Capital adequacy refers to a bank holding enough own capital, relative to its risk-weighted assets, to absorb unexpected losses — Basel III sets the minimum ratios banks must maintain, monitored by RBI for Indian banks.
No — PMLA obligations apply broadly across banks, NBFCs, and other regulated financial entities regardless of size, since money laundering can be attempted through any institution in the financial system.
Consequences vary by the nature of the lapse and regulator, ranging from formal warnings and monetary penalties to more significant supervisory action for repeated or serious non-compliance.
Yes — under powers granted by the Banking Regulation Act, RBI can, in specified circumstances, supersede a bank's board of directors and appoint an administrator to protect depositor interests.
Input tax credit is generally available to GST-registered businesses using the service for business purposes; individual consumers not registered under GST cannot claim ITC on personal banking charges.
No — Form 15G/15H can only be submitted by depositors whose estimated total income for the year is below the taxable threshold; submitting it when not eligible can attract penal consequences.
Partial withdrawals are allowed after a specified number of years subject to conditions, but PPF has a long statutory lock-in period overall, and premature closure is permitted only in specific circumstances defined by the scheme rules.
Usually not to the same extent — bundled cover with accounts or cards is often a limited, complimentary benefit, while a standalone health insurance policy typically offers materially higher and more comprehensive coverage.
