📑 Topics on this page (Jump to Topic):
📌 1. e-Banking: Meaning and Channels
e-Banking = banking services through electronic channels (internet, mobile, ATM, cards) — checking balance, sending money, paying bills, opening FDs — without visiting a branch, 24×7.
- Internet / net banking: on the bank’s website with user ID + password + OTP.
- Mobile banking: the bank’s app; without internet, the *99# (USSD) service.
- ATM (Automated Teller Machine), POS (Point of Sale) machines, phone banking, kiosks.
- Core Banking Solution (CBS): all branches are linked to a central server, so a customer can transact at any branch (CORE = Centralised Online Real-time Exchange).
📌 2. NEFT, RTGS, IMPS and Bank Codes
| NEFT | RTGS | IMPS | |
|---|---|---|---|
| Full form | National Electronic Funds Transfer | Real Time Gross Settlement | Immediate Payment Service |
| Settlement | Half-hourly batches (deferred net) | Each transaction instantly, one by one (gross) | Instant |
| Amount | No minimum or maximum limit | Minimum ₹2 lakh, no maximum | Up to ₹5 lakh |
| Operated by | RBI | RBI | NPCI |
| 24×7 since | 16 December 2019 | 14 December 2020 | From the start (2010) |
- IFSC (Indian Financial System Code): 11 characters — first 4 = bank code, 5th always 0, last 6 = branch code. Used in NEFT/RTGS/IMPS.
- MICR (Magnetic Ink Character Recognition) code: 9 digits printed on cheques — 3 city, 3 bank, 3 branch.
- SWIFT code (8 or 11 characters): identifies a bank for international (cross-border) transfers.
- NACH (NPCI): bulk and repetitive payments such as salaries, pensions, subsidies and EMIs.
⚠️ Exam Traps:
- RTGS has a minimum (₹2 lakh); NEFT does not.
- IFSC = 11 characters, MICR = 9 digits — do not swap them.
📌 3. UPI and NPCI Products
- NPCI (National Payments Corporation of India, 2008): an initiative of RBI and the Indian Banks’ Association under the Payment and Settlement Systems Act 2007.
- UPI (Unified Payments Interface): launched by NPCI on 11 April 2016; send money with a VPA/UPI ID (e.g. name@bank), a 4- or 6-digit UPI PIN, pay by QR code.
- BHIM app (30 December 2016); UPI 123PAY — UPI from feature phones (no smartphone/internet); UPI Lite — small payments without a PIN.
- *99# (NUUP): mobile banking over USSD. AePS: transactions at micro-ATMs with Aadhaar number + biometrics. BBPS (Bharat BillPay): electricity, water, gas and other bills.
- RuPay: NPCI’s domestic card network; FASTag (NETC): electronic toll payment.
💡 Memory Tip: “NPCI = UPI, IMPS, RuPay, AePS, BBPS, NACH, FASTag; RBI = NEFT, RTGS.”
📌 4. Cards, ATMs and Security Features
- Debit card — money from your own account; credit card — a credit limit from the bank (borrowing); prepaid card/wallet — money loaded in advance.
- CVV (Card Verification Value): 3 digits on the back of the card, used for online payments. EMV chip cards are safer than magnetic-stripe cards.
- Tokenisation (RBI, from 1 October 2022): merchants store a “token”, not the real card number.
- Contactless (NFC) “tap to pay”: up to ₹5,000 without a PIN. Two-factor authentication (2FA/AFA): password + OTP.
📌 5. Online Banking Fraud and Safety
| Fraud | How it works |
|---|---|
| Phishing | Fake e-mails/websites that steal passwords and card details |
| Vishing | A phone call from a fake “bank official” asking for OTP/PIN |
| Smishing | Fake links sent by SMS |
| Skimming | Copying card data with a hidden device on an ATM |
| SIM swap | Getting a duplicate SIM of your number to receive OTPs |
- Never share OTP, PIN, CVV or passwords — banks never ask for them. Log in only on https:// sites with a padlock; log out after use.
- On fraud, inform the bank at once and the National Cyber Crime Helpline 1930 / cybercrime.gov.in. RBI rule: for a third-party breach reported within 3 working days, the customer’s liability is zero.
⚠️ Exam Traps:
- You never enter a UPI PIN “to receive money” — the PIN is only for sending/paying.
📌 6. Practice MCQs
📝 Practice MCQs (prepared by SF Prep — not PYQs)
Q1. What is the minimum amount that can be sent through RTGS? Practice
Correct answer: (C)
RTGS is for large transfers: minimum ₹2 lakh, no maximum.
RTGS is for large transfers: minimum ₹2 lakh, no maximum.
Q2. How are NEFT transactions settled? Practice
Correct answer: (A)
NEFT is deferred net settlement in half-hourly batches; RTGS is gross and real-time.
NEFT is deferred net settlement in half-hourly batches; RTGS is gross and real-time.
Q3. From when has NEFT been available 24×7? Practice
Correct answer: (D)
NEFT became 24×7 on 16 December 2019 and RTGS on 14 December 2020.
NEFT became 24×7 on 16 December 2019 and RTGS on 14 December 2020.
Q4. Who operates the IMPS service? Practice
Correct answer: (B)
IMPS (2010) is NPCI’s instant, 24×7 payment service.
IMPS (2010) is NPCI’s instant, 24×7 payment service.
Q5. How many characters does an IFSC code have? Practice
Correct answer: (D)
IFSC = 11 characters: 4 bank + 0 + 6 branch.
IFSC = 11 characters: 4 bank + 0 + 6 branch.
Q6. What is the fifth character of an IFSC code always? Practice
Correct answer: (B)
The fifth character is reserved for future use and is always 0.
The fifth character is reserved for future use and is always 0.
Q7. How many digits does the MICR code printed on a cheque have? Practice
Correct answer: (C)
MICR = 9 digits (3 city, 3 bank, 3 branch).
MICR = 9 digits (3 city, 3 bank, 3 branch).
Q8. In which year was UPI launched? Practice
Correct answer: (A)
NPCI launched UPI on 11 April 2016.
NPCI launched UPI on 11 April 2016.
Q9. What is the full form of VPA in UPI? Practice
Correct answer: (B)
A VPA (UPI ID) such as name@bank lets you send money without sharing the account number/IFSC.
A VPA (UPI ID) such as name@bank lets you send money without sharing the account number/IFSC.
Q10. UPI 123PAY is meant for: Practice
Correct answer: (D)
UPI 123PAY allows UPI payments from feature phones without a smartphone or internet.
UPI 123PAY allows UPI payments from feature phones without a smartphone or internet.
Q11. What is the *99# service? Practice
Correct answer: (A)
*99# (NUUP) gives banking on any phone without internet.
*99# (NUUP) gives banking on any phone without internet.
Q12. What is needed for a transaction under AePS (Aadhaar enabled Payment System)? Practice
Correct answer: (C)
Under AePS money is withdrawn/deposited at a micro-ATM with Aadhaar + fingerprint.
Under AePS money is withdrawn/deposited at a micro-ATM with Aadhaar + fingerprint.
Q13. Bharat BillPay (BBPS) is used for: Practice
Correct answer: (B)
BBPS (NPCI) is the integrated bill-payment system.
BBPS (NPCI) is the integrated bill-payment system.
Q14. What is the full form of CVV? Practice
Correct answer: (C)
The CVV is the 3 digits on the back of a card used for online payments — never share it.
The CVV is the 3 digits on the back of a card used for online payments — never share it.
Q15. What does card tokenisation mean? Practice
Correct answer: (D)
Under the RBI rule (1 October 2022) merchants cannot store real card numbers, only tokens.
Under the RBI rule (1 October 2022) merchants cannot store real card numbers, only tokens.
Q16. Stealing passwords through fake e-mails or websites that look like a bank’s is called: Practice
Correct answer: (A)
Phishing = fake e-mails/sites; skimming = copying card data at an ATM.
Phishing = fake e-mails/sites; skimming = copying card data at an ATM.
Q17. A fraud in which a caller poses as a “bank official” and asks for your OTP is called: Practice
Correct answer: (C)
Vishing = voice phishing (phone call); smishing = by SMS.
Vishing = voice phishing (phone call); smishing = by SMS.
Q18. Copying card data with a hidden device fitted on an ATM is called: Practice
Correct answer: (A)
A skimmer steals the magnetic-stripe data to make cloned cards.
A skimmer steals the magnetic-stripe data to make cloned cards.
Q19. What is the National Cyber Crime Helpline number? Practice
Correct answer: (D)
Call 1930 at once for online fraud or complain on cybercrime.gov.in; 1098 is the child helpline.
Call 1930 at once for online fraud or complain on cybercrime.gov.in; 1098 is the child helpline.
Q20. What indicates a secure website for net banking? Practice
Correct answer: (B)
The “s” in https = secure (encryption); still check the address carefully.
The “s” in https = secure (encryption); still check the address carefully.