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JAIIB PPB Unit 1 — Banker-Customer Relationship: Free MCQs with Explanations

By Swarnakshi Jha (ex-banker) · Updated 20 September 2026 · Paper 2 of the November 2026 cycle (22 November 2026)

This page is a free slice of our JAIIB PPB question bank for Unit 1 — Banker-Customer Relationship (Module A — General Banking Operations). The Mock Centre holds 95 questions on this unit alone, every one with a why-right / why-wrong explanation; below are the facts examiners keep returning to, five of those questions to try, and the traps that cost marks.

PPB · Module A95 MCQs in the Mock Centre5 free belowPaper on 22 November 2026

Key facts examiners test from this unit

  1. Sec. 5(b) BR Act defines banking (deposits from PUBLIC for lending/investment, withdrawable by cheque/draft/order); Sec. 5(c) banking company; Sec. 7 bars 'bank' words; Sec. 6 permitted businesses.
  2. Cases: Kadiresan Chettiar (moneylender lends own money), Mahalaxmi Bank (no public deposits = no bank), Gopinathan Nair (duration irrelevant), Palai Central Bank (trustee → preferential refund), Traders Bank (draft purchase = debtor-creditor).
  3. Relationship table: deposit → bank Debtor; loan → bank Creditor; safe custody → Bailee; locker → Lessor (Sec. 105 TPA); collection/SI/securities/shares-for-sale → Agent (Sec. 182 ICA); payee of draft, money without instructions, articles left by mistake → Trustee; pledge → Pawnee; mortgage → Mortgagee; hypothecation → Hypothecatee; duplicate DD/FDR → customer Indemnifier (Sec. 124 ICA).

5 free practice questions — tap an option

Five basic questions from this unit. Answers lock on the first tap, exactly as in the exam, and a short explanation opens underneath. The Mock Centre adds the moderate and tough questions, why every other option is wrong, the concept capsule and the exam tip — with your score and revision dates tracked.

Question 1 of 5
Under Sec. 6 of the BR Act, a bank may engage in:
Why (b): Sec. 6 permits a bouquet of ancillary businesses — bill discounting, remittances, safe custody, lockers, letters of credit, guarantees, agency work and more.
Question 2 of 5
In a mortgage, the customer is the:
Why (b): The customer who transfers the interest in immovable property as security is the MORTGAGOR; the bank is the mortgagee.
Question 3 of 5
The distinguishing feature of a Recurring Deposit (RD) is:
Why (b): RD = a fixed sum deposited MONTHLY for an agreed period — savings built by instalments.
Question 4 of 5
Which older remittance product became redundant after Core Banking?
Why (b): MT/TT — the mail- and telegram-based transfers — died once CBS made every branch instantly connected.
Question 5 of 5
In the relationship table, for 'sale and purchase of securities on behalf of the customer' the bank is:
Why (b): Executing the customer's mandate in the market = agency, the same box as shares given for sale and standing instructions.
0 of 5 answered.

Traps in this unit

Confusable AConfusable BThe difference
Sec. 5(b)Sec. 5(c)Defines BANKING vs defines BANKING COMPANY
Purchase of a draftPayee of a draftBank = DEBTOR (Traders Bank) vs bank = TRUSTEE
Practise all 95 questions on Unit 1. The free demo opens a slice of every subject with the same explanations; the PPB Online-only pass unlocks all 3,280 PPB questions, the full and module mocks, Smart Revision and the Readiness Score for one year (₹1,299). Not sure where you stand? Take the free 10-question test first.
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Unit 2: AML-KYC Guidelines → · All PPB units · JAIIB 2026 guide

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Independent study aid — not affiliated with, endorsed by, or sponsored by the Indian Institute of Banking & Finance (IIBF). Exam pattern, dates, fees and passing criteria are set by IIBF — always confirm the current rules at iibf.org.in. Regulatory figures verified as of September 2026; verify from official sources before relying on them in practice.