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JAIIB PPB Unit 3 — Operational Aspects of KYC: 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 3 — Operational Aspects of KYC (Module A — General Banking Operations). The Mock Centre holds 97 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 A97 MCQs in the Mock Centre5 free belowPaper on 22 November 2026

Key facts examiners test from this unit

  1. KYC MD 2016 applies to overseas branches/majority-owned subsidiaries; conflict → follow the MORE STRINGENT standard.
  2. CAP: no benami/anonymous accounts, no account without CDD, sanctions-list screening, PAN verification, all joint holders' CDD — but no denial to the disadvantaged; non-compliant existing accounts closed after notice.
  3. ₹50,000 = the CIP magic number (walk-ins, product sales, card loads, structuring); international transfers for non-customers = ANY value.
Law update, September 2026. Current law: the PML (Maintenance of Records) Amendment Rules of 7 March 2023 — mirrored in RBI's KYC Master Direction from 4 January 2024 — lowered the 'controlling ownership interest' tests: company MORE THAN 10% of shares/capital/profits (was 25%), partnership MORE THAN 10% of capital/profits (was 15%), trust beneficiaries 10% or more (was 15%); an unincorporated association/body of individuals stays at more than 15%. The textbook still keys the older figures — follow them for the exam unless a question says 'under the current norms'.

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 the Customer Acceptance Policy, the bank will NOT open an account:
Why (b): BENAMI/FICTITIOUS-name accounts are absolutely barred by the CAP (as are accounts where CDD cannot be completed).
Question 2 of 5
An individual who does not have PAN may submit:
Why (b): An individual without PAN may submit FORM 60 — the sworn declaration that substitutes for the missing PAN in account opening and specified transactions.
Question 3 of 5
The final decision to file an STR rests with the:
Why (b): The PO (MLRO) takes the filing call on escalated alerts and signs off to FIU-IND.
Question 4 of 5
When a minor account holder attains majority, the bank must obtain:
Why (a): On majority: fresh photograph and operational updates (signature, operating instructions).
Question 5 of 5
Periodic KYC updation cycles run:
Why (b): The 2-8-10 ladder, softened by declaration-based re-KYC for no-change cases — a customer-service reform exam setters love.
0 of 5 answered.

Traps in this unit

Confusable AConfusable BThe difference
₹50,000 walk-in thresholdAny-value international transferDomestic trigger vs no-threshold cross-border rule
Small Account ₹50,000OTP e-KYC ₹1 lakhBALANCE caps of the two relaxed regimes
Practise all 97 questions on Unit 3. 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 · Unit 4: Opening Accounts of Various Types of Customers → · 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.