BANKING AFFAIRS

Detailed explanation-1: -RBI stands for Reserve Bank of India. It is the central bank of India. It is the apex bank and has the sole authority to issue and manage currency in India. Thus, the rate of interest on savings bank account is stipulated by RBI.

Detailed explanation-2: -The Correct Answer is Reserve Bank of India(RBI). The banks mainly decided on the rate of interest they pay on a savings bank account. However, on 1 March 2003, the RBI (Reserve Bank of India) had controlled the interest rates on savings accounts and has since remained unchanged.

Detailed explanation-3: -With effect from October 18, 1994, RBI has deregulated the interest rates on advances above Rs. 2 lakh and the rates of interest on such advances are determined by the banks themselves subject to BPLR and Spread guidelines. For credit limits up to Rs. 2 lakh, banks should charge interest not exceeding their BPLR.

Detailed explanation-4: -The MPC determines the policy repo rate required to achieve the inflation target. The MPC is required to meet at least four times in a year. The quorum for the meeting of the MPC is four members.

Detailed explanation-5: -A lot of public and private sector banks in India offer individuals different kinds of savings account as per their needs and requirements. All banks set interest rates on their savings accounts that usually vary from 2.50% per annum to 7.00% per annum depending on the amount of savings.