BANKING GENERAL KNOWLEDGE
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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2-7 days
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2-14 days
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2-21 days
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2-28 days
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Detailed explanation-1: -Under call money market, funds are transacted on overnight basis and under notice money market, funds are transacted for the period between 2 days and 14 days. 2.1 Participants in call/notice money market currently include banks (excluding RRBs) and Primary Dealers (PDs), both as borrowers and lenders (Annex I).
Detailed explanation-2: -Where money is borrowed or lend for period between 2 days and 14 days it is known as ‘Notice Money’. And ‘Term Money’ refers to borrowing/lending of funds for period exceeding 14 days.
Detailed explanation-3: -Treasury Bills Treasury Bills are one of the most popular money market instruments. They have varying short-term maturities. The Government of India issues it at a discount for 14 days to 364 days. These instruments are issued at a discount and repaid at par at the time of maturity.
Detailed explanation-4: -Money market transactions are categorized as follows: Borrowing/Lending for 1 day is known as Call Money. Borrowing/Lending for 2-14 days is known as Notice Money. Borrowing/Lending for more than 14 days is known as Term Money.