Skip to content
GK24
Prime
Indian EconomyEasy

How many commercial banks were nationalised in India in the first round of bank nationalisation in July 1969?

  1. A.Six
  2. B.Twelve
  3. C.Fourteen
  4. D.Twenty

Correct answer

C. Fourteen

Explanation

The correct answer is C, Fourteen. On 19 July 1969 the government nationalised fourteen of the largest commercial banks in the country, the aim being to take banking to rural areas, direct credit to agriculture and small industry, and end the concentration of bank funds in a few business houses.

Option A, six, is the number of banks nationalised in the second round in April 1980, so it is a correct figure attached to the wrong year. Option B, twelve, does not correspond to any round of nationalisation and is put in only as a near miss. Option D, twenty, is the total of the two rounds taken together, fourteen plus six, and is the trap most often chosen. Read the year in the question carefully, because papers ask the same fact as 1969, as 1980 and as the combined total.

Read the full article: Money and Banking in India: RBI, Supply and Policy

Practice Questions

View all
Q1.Indian EconomyEasy

The Reserve Bank of India began its operations on which date?

  1. A.1 April 1935
  2. B.1 January 1949
  3. C.1 July 1955
  4. D.19 July 1969
Show answer
Correct answer: A. 1 April 1935

The Reserve Bank of India was constituted under the Reserve Bank of India Act of 1934, on the recommendation of the Hilton Young Commission, and started functioning on 1 April 1935 with its central office at Calcutta, which was shifted permanently to Bombay in 1937.

Q3.Indian EconomyEasy

The repo rate is the rate of interest at which

  1. A.Commercial banks lend to their prime customers
  2. B.The Reserve Bank lends short-term funds to banks against government securities
  3. C.The Reserve Bank borrows surplus funds from commercial banks
  4. D.Banks pay interest on savings deposits
Show answer
Correct answer: B. The Reserve Bank lends short-term funds to banks against government securities

In a repurchase or repo transaction a bank sells government paper to the Reserve Bank and agrees to buy it back shortly afterwards at a slightly higher price; the difference works out as interest at the repo rate.

Q4.Indian EconomyMedium

In India, the one rupee note is issued by

  1. A.The Reserve Bank of India
  2. B.The State Bank of India
  3. C.The Government of India
  4. D.The Security Printing and Minting Corporation
Show answer
Correct answer: C. The Government of India

The one rupee note and all coins are issued by the Government of India through the Ministry of Finance, and the one rupee note carries the signature of the Finance Secretary rather than that of the Governor of the Reserve Bank.