Banking Awareness Quiz – Set 55 – Prepaid Payment Instruments (PPIs)

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Number of Questions: 10

1. An entity registered under which act can issue PPIs?
   A) Reserve Bank of India Act, 1934
   B) Companies Act, 1956 / Companies Act, 2013
   C) Banking Regulations Act, 1949
   D) Payment and. Settlement Systems Act, 2007
   
   View answer

   Option B
   Explanation: A company incorporated in India and registered under the Companies Act, 1956 / Companies Act, 2013 can issue and operate PPIs after receiving authorisation from RBI.
2. Which of the following is not one of the types of PPIs issued?
   A) Closed System PPIs
   B) Semi-closed System PPIs
   C) Open System PPIs
   D) Semi-open System PPIs
   
   View answer

   Option D
   Explanation: PPIs that can be issued in the country are classified under three types (i) Closed System PPIs, (ii) Semi-closed System PPIs, and (iii) Open System PPIs.
3. What is the rate of interest offered on PPI balance?
   A) 1%
   B) 2%
   C) Zero
   D) 3%
   
   View answer

   Option C
   Explanation: No interest is payable on PPI balances.
4. What is the maximum permitted limit of balance at any point in time in PPIs per month?
   A) Rs 75,000
   B) Rs 1 lakh
   C) Rs 25,000
   D) Rs 50,000
   
   View answer

   Option D
   Explanation: The cash loading of PPIs is limited to ₹ 50,000/- per month
5. What is the minimum validity period of a PPI?
   A) 6 months
   B) 12 months
   C) 9 months
   D) 3 months
   
   View answer

   Option B
   Explanation: All PPIs shall have a minimum validity period of one year from the date of last loading / reloading in the PPI. 
6. A PPI will be treated as inactive, if it has not been used for a period of _________
   A) 6 months
   B) 24 months
   C) 12 months
   D) 18 months
   
   View answer

   Option C
   Explanation: A PPI with no financial transaction for a consecutive period of one year shall be made / treated as inactive after sending a notice to the PPI holder. 
7. The PPIs that are issued by an entity for facilitating the purchase of goods and services from that entity only and do not permit cash withdrawal are known as_____________
   A) Open System PPIs
   B) Semi-closed System PPIs
   C) Semi-open System PPIs
   D) Closed System PPIs
   
   View answer

   Option D
   Explanation: PPIs are issued by an entity for facilitating the purchase of goods and services from that entity only and do not permit cash withdrawal.
8. Paytm, MobiKwik is an example of which type of PPI?
   A) Semi-closed System PPIs
   B) Open System PPIs
   C) Closed System PPIs
   D) Semi-Open System PPIs
   
   View answer

   Option A
   Explanation: These PPIs do not permit cash withdrawal, irrespective of whether they are issued by banks or non-banks.
9. Which of the following is an example of Open System PPIs?
   A) Rupay
   B) Paytm Wallet
   C) Ola Money
   D) All the above
   
   View answer

   Option A
   Explanation: All Rupay and Master, Visa cards are Open System PPIs
10. In the Open System PPIs, the outstanding amount should not exceed______________ at any point.
    A) Rs 10,000
    B) Rs 50,000
    C) Rs 1 lakh
    D) Rs 2 lakh
    
    View answer

    Option C
    Explanation: The amount outstanding in such a PPI shall not exceed ₹1,00,000/- at any point of time.

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