General Awareness — Topic 10 — General Awareness

General Awareness — Topic 10

🟢 Lite — Quick Review (1h–1d)

Rapid summary for last-minute revision before your exam.

This topic aggregates four question buckets in SBI PO: banking awareness, static GK, financial awareness, and current affairs spanning the last ~6 months. The minimum viable recall set is: RBI’s six traditional functions, the LAF corridor (Repo ↔ MSF), CRR vs SLR definitions, the difference between Fiscal Deficit and Primary Deficit, the full form of CPSS bodies (SEBI, IRDAI, PFRDA, RBI), and key scheme acronyms (PMJDY, MUDRA, APY, PM-KISAN, SSY). Memory trick — every percentage RBI controls is computed on NDTL (Net Demand and Time Liabilities), not deposits alone. Memorise Repo Rate, Reverse Repo, MSF, Bank Rate and CRR as a 5-line ladder.

🟡 Standard — Regular Study (2d–2mo)

Standard content for students with a few days to months.

Indian Banking Structure

The Reserve Bank of India (RBI), established under the RBI Act 1934 and nationalised in 1949, sits at the apex. Below it: 12 Public Sector Banks post the 2019 amalgamation (e.g., SBI, PNB, Bank of Baroda), Private Sector Banks (HDFC, ICICI, Kotak), Foreign Banks (Citi, Standard Chartered), 56 Regional Rural Banks (RRBs), Cooperative Banks (Urban + State), and Small Finance Banks + Payment Banks licensed since 2015. RBI’s six statutory functions: monetary authority, issuer of currency, regulator of banking, manager of foreign exchange, developmental role, and banker to the government.

Monetary Policy Toolkit

All ratios are computed on NDTL (Net Demand and Time Liabilities):

Tool	What it does	Direction
Repo Rate	Rate at which RBI lends to banks overnight against securities	Main policy signal
Reverse Repo	Rate RBI pays on bank deposits with it	Floor of LAF corridor
MSF (Marginal Standing Facility)	Banks borrow from RBI by dipping into SLR (penal rate = Repo + 2%)	Ceiling of corridor
Bank Rate	Long-term RBI lending rate	Sticky legacy rate
CRR	Cash parked with RBI (currently 4%)	No interest paid
SLR	Gold + G-Secs + cash maintained by banks (currently 18%)	Earns interest

Fiscal Concepts

Fiscal Deficit = Total Expenditure − Total Receipts (excluding borrowings). Primary Deficit = Fiscal Deficit − Interest Payments, showing the government’s borrowing need for fresh spending. Effective Revenue Deficit = Revenue Expenditure − Revenue Receipts (excluding grants for capital assets). The FRBM Act, 2003 (amended 2018) anchors fiscal targets.

Government Schemes Snapshot

PMJDY (Aug 2014) targets financial inclusion with zero-balance RuPay cards and a ₹10,000 overdraft for active accounts. MUDRA Yojana lends under three slabs — Shishu (≤₹50,000), Kishore (₹50,000–5 lakh), Tarun (₹5–10 lakh). Stand-Up India facilitates loans of ₹10 lakh–₹1 crore to SC/ST and women entrepreneurs. APY is a pension scheme for the unorganised sector (age 18–40; ₹1,000–₹5,000 monthly pension). SSY is a girl-child savings account with Section 80C tax benefit.

Regulatory Architecture

SEBI regulates securities markets; IRDAI insurance; PFRDA pensions (NPS, APY); RBI banking + payments. DICGC insures each depositor up to ₹5 lakh per bank. CIBIL (TransUnion CIBIL) maintains the credit bureau database.

🔴 Extended — Deep Study (3mo+)

Comprehensive coverage for students on a longer study timeline.

Exam Strategy by Section

SBI PO Prelims dedicates GA to a 25-question, 20-mark qualifying section where sectional cut-off applies only in Mains. The Mains General/Financial Awareness is tier-2 (50 Qs, 50 marks, 35 min) and is the tiebreaker between candidates with equal descriptive scores. Roughly 60% of questions test the preceding 6 months’ current affairs (RBI policy rates, GDP prints, Union Budget, census/survey releases), 25% static banking, and 15% financial markets/economy fundamentals.

Edge Cases & Classic Traps

MSF vs Repo: Many answer keys trap candidates by calling MSF the penalty rate — it is Repo + 2% only since 2014, and banks may dip into SLR up to 2% below the prescribed level to access MSF. CRR is maintained in cash only (cash + current account with RBI), while SLR includes gold and government securities. Reverse Repo rate changes don’t always move in lockstep with Repo. NBFC deposit-taking NBFCs are registered under Companies Act and not deposits insured by DICGC. NPA classification: an account becomes NPA if interest/installment is overdue for 90 days (90 DPD rule), but for agriculture the threshold is two crop seasons (short) or one season (long). Basel III requires Capital Conservation Buffer of 2.5% on top of minimum 8% CAR. ETF in the Indian context refers to Equity Tracker Funds tracking Nifty/BSE indices, used for government disinvestment (CPSE ETF, Bharat 22). SWIFT is a messaging network, not a fund transfer system; UPI by NPCI is built on IMPS rails.

Cross-Links with Tier-1

Quantitative Aptitude’s SI/Compound interest questions sometimes use Repo/CPI data. Reasoning Data Sufficiency sets occasionally embed schemes (APY contribution eligibility). Keep GA ready because it’s the quickest scoring tier in Mains if revision is current.

Practice Prompts:

If RBI raises Repo Rate by 25 bps, citing NDTL changes and pre-existing SLR, will CRR in absolute terms change? Why or why not?
A 28-year-old self-employed woman from an SC family seeks ₹15 lakh working capital. Name the scheme, upper loan limit, and sponsoring agency.

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General Awareness — Topic 10