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JAIIB RBWM Unit 8 — Important Retail Liability Products: Free MCQs with Explanations

By Swarnakshi Jha (ex-banker) · Updated 20 September 2026 · Paper 4 of the November 2026 cycle (29 November 2026)

This page is a free slice of our JAIIB RBWM question bank for Unit 8 — Important Retail Liability Products (Module B — Retail Products and Recovery). The Mock Centre holds 118 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.

RBWM · Module B118 MCQs in the Mock Centre5 free belowPaper on 29 November 2026

Key facts examiners test from this unit

  1. Deposits = bank liabilities; loans = assets; intermediation = the core function; ONLY banks may take demand deposits; demand = CASA, time = FD + RD.
  2. Current accounts: nil interest, higher minimum balance (higher transaction cost — the textbook's Check Your Progress logic), unlimited transactions, businessmen; NIM-friendly; inoperative after 2 years (reactivation = fresh KYC); company closure needs board resolution; business entities can't hold SB.
  3. RBI current-account discipline (29-10-2021): ₹5-crore exposure trigger; ≥10%-exposure banks only; non-lending banks barred; collection sweeps in 2 working days; NALSA (15-4-2014) for transgender accounts; Damodaran Committee → number portability.
Law update, September 2026. The basic exemption limit now depends on the regime: OLD regime ₹2.5 lakh (below 60), ₹3 lakh (60–79), ₹5 lakh (80+); NEW (default) regime ₹3 lakh for FY 2023-24 and 2024-25 and ₹4 lakh from FY 2025-26 for every age. 'Per the textbook' → ₹2.5 lakh. Current law: the Banking Laws (Amendment) Act 2025 allows up to four nominees, successively or simultaneously; the trustee-of-heirs principle is unchanged.

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
Taking public deposits and lending to productive activities is called:
Why (b): Taking deposits from savers and lending them to businesses and borrowers — standing in the middle of money — is INTERMEDIATION, the core function that makes a bank a bank.
Question 2 of 5
Current accounts are typically opened by:
Why (c): Current accounts are built for BUSINESSMEN and business entities — traders, firms, companies — whose money moves constantly and who need unlimited transactions more than interest.
Question 3 of 5
FD interest credited to SB quarterly:
Why (b): An FD whose interest is CREDITED TO YOUR SAVINGS account every quarter is the SIMPLE (payout) FD — income now, principal at maturity.
Question 4 of 5
An RD can be opened by:
Why (b): An RD may be opened in one's OWN name, JOINTLY with others, or by a MINOR aged 10+ in their own name — the full eligibility menu.
Question 5 of 5
Under 'Former or Survivor' operation, while BOTH holders are alive the account is operated by:
Why (b): F-or-S locks operation to the first-named holder during joint lives — the survivor's rights activate on death. E-or-S is the version where either operates anytime.
0 of 5 answered.

Traps in this unit

Confusable AConfusable BThe difference
DepositLoanLiability vs asset
DemandTime depositsCASA vs FD/RD
Practise all 118 questions on Unit 8. The free demo opens a slice of every subject with the same explanations; the RBWM Online-only pass unlocks all 1,912 RBWM 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.
Take the free test Open the free demo

← Unit 7: Credit Scoring · Unit 9: Important Retail Asset Products → · All RBWM 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.