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JAIIB · Principles & Practices of Banking · Module B — Functions of Banks

JAIIB PPB Unit 26 — Different Modes of Charging Securities: 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 26 — Different Modes of Charging Securities (Module B — Functions of Banks). 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 B95 MCQs in the Mock Centre5 free belowPaper on 22 November 2026

Key facts examiners test from this unit

  1. Contract basics: Sec. 2(h); free-consent vitiators (coercion/undue influence/fraud/ misrepresentation/mistake → voidable); Sec. 25 no-consideration exceptions; Sec. 11/12 capacity; Mohori Bibee — minor's agreement void ab initio.
  2. Agency: Sec. 182; no consideration needed (Sec. 185); emergency authority Sec. 189; del credere agent; termination modes; principal liable for agents' frauds within authority; agent's lien; PoA = the usual agency form.
  3. Bailment: Sec. 148; essence = possession; money deposit ≠ bailment (debtor-creditor); Sec. 150 disclosure; Sec. 151 prudent-man care; banker's GENERAL lien (Sec. 171) = implied pledge; ordinary lien = retain only; negative lien = unregistered covenant.

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
When a proposal is accepted, it becomes a:
Why (b): Proposal + acceptance = PROMISE; with consideration and enforceability it matures into a contract.
Question 2 of 5
The person DELIVERING goods in bailment is the:
Why (b): The person DELIVERING goods in bailment is the BAILOR — the bailor gives, the bailee receives.
Question 3 of 5
Mortgage is defined in:
Why (a): Mortgage is defined in SECTION 58(a) of the Transfer of Property Act — the transfer of an interest in specific immovable property to secure a debt.
Question 4 of 5
'The pawnee can sell the goods if the pawnor fails to pay.' This is:
Why (b): TRUE — the pawnee can sell the pledged goods if the pawnor fails to pay, but only AFTER REASONABLE NOTICE of the intended sale.
Question 5 of 5
Right of SET-OFF lets a bank:
Why (b): Set-off merges mutual debts: the depositor-creditor becomes borrower-debtor and balances net — mutuality (same parties, same right) is essential; contingent debts don't qualify.
0 of 5 answered.

Traps in this unit

Confusable AConfusable BThe difference
Pledge (Sec. 172)Hypothecation (SARFAESI 2(n))Possession with bank vs with borrower
LienPledgeRetain only vs retain + sell (after notice)
Practise all 95 questions on Unit 26. 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 25: Types of Collaterals and Their Characteristics · Unit 27: Documentation → · 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.