Banker Customer Relationship MCQs is the cornerstone topic for aspirants. In this guide, we cover the 40 most important questions. This Vital mock test is specifically designed for Bank Exams, IBPS, SBI, RBI, and Promotion Exams to help you master the concepts quickly.
Why This [Banker Customer Relationship MCQs] Test Matters?
Exam Weightage: This topic is essential for scoring high in the General Awareness section of IBPS/SBI PO and Clerk exams. Furthermore, understanding these relationships is critical for mastering internal guidelines required for Promotion Exams.
Difficulty: Moderate to Hard (Concept-based).
Practice Banker Customer Relationship MCQs (Live Mock Test)
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Banker Customer Relationship MCQs – 40 Most Expected Questions
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In a Debtor-Creditor relationship between a bank and a customer, who is the debtor when a customer deposits money into an account?
Explanation
Correct: B
The bank. When a customer deposits money, the bank owes this amount to the customer, making the bank the debtor. This is a fundamental concept in Banker Customer Relationship MCQs.
The bank. When a customer deposits money, the bank owes this amount to the customer, making the bank the debtor. This is a fundamental concept in Banker Customer Relationship MCQs.
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Which legal framework primarily governs the Debtor-Creditor relationship?
Explanation
Correct: B
Indian Contract Act, 1872. Contract Law is one of the primary legal frameworks governing Debtor-Creditor relationships. Understanding this act is vital for answering Banker Customer Relationship MCQs.
Indian Contract Act, 1872. Contract Law is one of the primary legal frameworks governing Debtor-Creditor relationships. Understanding this act is vital for answering Banker Customer Relationship MCQs.
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When a bank provides a loan to a customer, what is the role of the bank in this relationship?
Explanation
Correct: B
Creditor. In a loan scenario, the bank is the creditor, providing funds to the customer. This scenario is frequently tested in Banker Customer Relationship MCQs and relates to the Banking Regulation Act.
Creditor. In a loan scenario, the bank is the creditor, providing funds to the customer. This scenario is frequently tested in Banker Customer Relationship MCQs and relates to the Banking Regulation Act.
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Which of the following is NOT a relevant legal framework for a Creditor-Debtor relationship?
Explanation
Correct: D
Succession Laws. Succession Laws are related to inheritance, not loan agreements. Mastering these distinctions helps in solving Banker Customer Relationship MCQs accurately.
Succession Laws. Succession Laws are related to inheritance, not loan agreements. Mastering these distinctions helps in solving Banker Customer Relationship MCQs accurately.
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What term is used for the customer who pledges movable assets as collateral for a loan?
Explanation
Correct: B
Pledger. The customer who offers the collateral is known as the pledger. This terminology is a key part of Banker Customer Relationship MCQs vocabulary.
Pledger. The customer who offers the collateral is known as the pledger. This terminology is a key part of Banker Customer Relationship MCQs vocabulary.
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Under which act is the Pledger-Pledgee relationship primarily governed?
Explanation
Correct: B
Indian Contract Act, 1872. The Indian Contract Act, 1872, governs the Pledger-Pledgee relationship. Note that this is distinct from Section 131 NI Act provisions often cited in Banker Customer Relationship MCQs.
Indian Contract Act, 1872. The Indian Contract Act, 1872, governs the Pledger-Pledgee relationship. Note that this is distinct from Section 131 NI Act provisions often cited in Banker Customer Relationship MCQs.
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In a mortgage agreement, who is the Mortgagor?
Explanation
Correct: B
The customer. The customer who mortgages their property is the Mortgagor. Identifying the correct party is crucial in Banker Customer Relationship MCQs.
The customer. The customer who mortgages their property is the Mortgagor. Identifying the correct party is crucial in Banker Customer Relationship MCQs.
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Which legal act governs the Mortgagor-Mortgagee relationship?
Explanation
Correct: C
Transfer of Property Act, 1882. This act specifically deals with property mortgages. This is a recurring fact in many Banker Customer Relationship MCQs.
Transfer of Property Act, 1882. This act specifically deals with property mortgages. This is a recurring fact in many Banker Customer Relationship MCQs.
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What is the role of the Hypothecatee in a hypothecation agreement?
Explanation
Correct: B
The bank that receives the security. The bank is the Hypothecatee. This relationship is often verified during KYC Norms checks in the context of Banker Customer Relationship MCQs.
The bank that receives the security. The bank is the Hypothecatee. This relationship is often verified during KYC Norms checks in the context of Banker Customer Relationship MCQs.
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Which act is specifically relevant to hypothecation transactions?
Explanation
Correct: C
SARFAESI Act, 2002. The SARFAESI Act, 2002, is particularly relevant to hypothecation. This act’s applicability is a favorite topic in Banker Customer Relationship MCQs.
SARFAESI Act, 2002. The SARFAESI Act, 2002, is particularly relevant to hypothecation. This act’s applicability is a favorite topic in Banker Customer Relationship MCQs.
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In a Principal-Agent relationship, who is the Agent?
Explanation
Correct: B
The bank. The bank acts as an agent when instructed to perform financial transactions. This role is a core component of Banker Customer Relationship MCQs.
The bank. The bank acts as an agent when instructed to perform financial transactions. This role is a core component of Banker Customer Relationship MCQs.
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Which law governs the Principal-Agent relationship between a banker and customer?
Explanation
Correct: B
Indian Contract Act, 1872. The Indian Contract Act, 1872, governs agency relationships. Situations involving a Garnishee Order often test this aspect of Banker Customer Relationship MCQs.
Indian Contract Act, 1872. The Indian Contract Act, 1872, governs agency relationships. Situations involving a Garnishee Order often test this aspect of Banker Customer Relationship MCQs.
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When a customer entrusts valuable items to the bank for safekeeping, what is the bank’s role?
Explanation
Correct: B
Trustee. The bank acts as a trustee in safekeeping scenarios. This distinction is vital for answering advanced Banker Customer Relationship MCQs.
Trustee. The bank acts as a trustee in safekeeping scenarios. This distinction is vital for answering advanced Banker Customer Relationship MCQs.
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Which legal framework is relevant when a bank manages the estate of a deceased person?
Explanation
Correct: C
Succession Laws. Succession Laws and Probate Laws govern the management of deceased estates. This knowledge is essential for specific Banker Customer Relationship MCQs.
Succession Laws. Succession Laws and Probate Laws govern the management of deceased estates. This knowledge is essential for specific Banker Customer Relationship MCQs.
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In a safe deposit locker facility, what is the bank’s role?
Explanation
Correct: A
Lessor. The bank is the lessor, providing the locker facility. Confusing this with bailment is a common trap in Banker Customer Relationship MCQs.
Lessor. The bank is the lessor, providing the locker facility. Confusing this with bailment is a common trap in Banker Customer Relationship MCQs.
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When a customer entrusts goods to the bank for safekeeping (not as a pledge), what is the customer’s role?
Explanation
Correct: C
Bailor. The customer entrusting the goods is the bailor. Understanding bailment is key to mastering Banker Customer Relationship MCQs.
Bailor. The customer entrusting the goods is the bailor. Understanding bailment is key to mastering Banker Customer Relationship MCQs.
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When a bank provides financial advice to a customer, what is the bank’s role?
Explanation
Correct: C
Advisor. The bank is the advisor in this context. This is one of the simpler yet important Banker Customer Relationship MCQs.
Advisor. The bank is the advisor in this context. This is one of the simpler yet important Banker Customer Relationship MCQs.
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What is the role of the bank when it issues a guarantee on behalf of a customer?
Explanation
Correct: B
Indemnitor. The bank is the indemnitor, providing the guarantee. This role implies significant liability, often discussed in Banker Customer Relationship MCQs.
Indemnitor. The bank is the indemnitor, providing the guarantee. This role implies significant liability, often discussed in Banker Customer Relationship MCQs.
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If a customer assigns a debt to the bank, what is the customer’s role in this scenario?
Explanation
Correct: B
Assignor. The customer assigning the debt is the assignor. Assignment clauses are frequently covered in Banker Customer Relationship MCQs.
Assignor. The customer assigning the debt is the assignor. Assignment clauses are frequently covered in Banker Customer Relationship MCQs.
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Which legal framework is primarily involved in assignment scenarios?
Explanation
Correct: B
Contract Law. Contract Law, along with the Transfer of Property Act, 1882, governs assignments. This legal basis is foundational for Banker Customer Relationship MCQs.
Contract Law. Contract Law, along with the Transfer of Property Act, 1882, governs assignments. This legal basis is foundational for Banker Customer Relationship MCQs.
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Which type of transaction establishes a Debtor-Creditor relationship between a bank and its customer?
Explanation
Correct: B
When a customer deposits money. Depositing money makes the bank a debtor to the customer. This is the most basic example found in Banker Customer Relationship MCQs.
When a customer deposits money. Depositing money makes the bank a debtor to the customer. This is the most basic example found in Banker Customer Relationship MCQs.
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In a Debtor-Creditor relationship, the bank’s primary role is that of a:
Explanation
Correct: C
Debtor. When accepting deposits, the bank is the debtor. Remember this core principle for your Banker Customer Relationship MCQs.
Debtor. When accepting deposits, the bank is the debtor. Remember this core principle for your Banker Customer Relationship MCQs.
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What is the customer’s role in a Creditor-Debtor relationship when they receive a loan?
Explanation
Correct: B
Debtor. The customer becomes the debtor when they take out a loan. Flipping these roles is a common error in Banker Customer Relationship MCQs.
Debtor. The customer becomes the debtor when they take out a loan. Flipping these roles is a common error in Banker Customer Relationship MCQs.
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Which of these documents is most likely to define the specifics of a Creditor-Debtor relationship?
Explanation
Correct: B
Loan agreement. Loan agreements specify the terms of the Creditor-Debtor relationship. Documentation is a key practical aspect of Banker Customer Relationship MCQs.
Loan agreement. Loan agreements specify the terms of the Creditor-Debtor relationship. Documentation is a key practical aspect of Banker Customer Relationship MCQs.
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What is the nature of the assets in a Pledger-Pledgee relationship?
Explanation
Correct: B
Movable assets/securities. These are used as collateral in a pledge. Distinguishing asset types is critical for Banker Customer Relationship MCQs.
Movable assets/securities. These are used as collateral in a pledge. Distinguishing asset types is critical for Banker Customer Relationship MCQs.
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The bank’s role in a Pledger-Pledgee relationship is that of a:
Explanation
Correct: B
Pledgee. The bank holds the pledge as the pledgee. Keep these terms clear when solving Banker Customer Relationship MCQs.
Pledgee. The bank holds the pledge as the pledgee. Keep these terms clear when solving Banker Customer Relationship MCQs.
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What type of property is involved in a Mortgagor-Mortgagee relationship?
Explanation
Correct: B
Immovable property. Mortgages involve immovable property. This is a definitional question often appearing in Banker Customer Relationship MCQs.
Immovable property. Mortgages involve immovable property. This is a definitional question often appearing in Banker Customer Relationship MCQs.
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Who holds the mortgage on the property?
Explanation
Correct: B
Mortgagee. The bank or lender is the mortgagee. This role identification is standard in Banker Customer Relationship MCQs.
Mortgagee. The bank or lender is the mortgagee. This role identification is standard in Banker Customer Relationship MCQs.
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How is possession handled in a Hypothecator-Hypothecatee relationship?
Explanation
Correct: B
Possession remains with the customer. Hypothecation does not involve transfer of possession. This feature distinguishes it in Banker Customer Relationship MCQs.
Possession remains with the customer. Hypothecation does not involve transfer of possession. This feature distinguishes it in Banker Customer Relationship MCQs.
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Which law specifically addresses actions a bank can take in case of default in a hypothecation agreement?
Explanation
Correct: C
SARFAESI Act, 2002. This act allows banks to take action in case of default. Its enforcement power is a key topic in Banker Customer Relationship MCQs.
SARFAESI Act, 2002. This act allows banks to take action in case of default. Its enforcement power is a key topic in Banker Customer Relationship MCQs.
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What is the customer known as in a Principal-Agent relationship with the bank?
Explanation
Correct: B
Principal. The customer is the principal who gives instructions. This hierarchical relationship is explored in Banker Customer Relationship MCQs.
Principal. The customer is the principal who gives instructions. This hierarchical relationship is explored in Banker Customer Relationship MCQs.
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When the bank acts on behalf of the customer, it is fulfilling the role of an:
Explanation
Correct: B
Agent. The bank acts as an agent for the customer. This applies to check collection and other services in Banker Customer Relationship MCQs.
Agent. The bank acts as an agent for the customer. This applies to check collection and other services in Banker Customer Relationship MCQs.
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In a Trustee-Beneficiary relationship, who benefits from the entrusted items/assets?
Explanation
Correct: B
Beneficiary. The beneficiary is the one who benefits. Understanding the flow of benefit is useful for Banker Customer Relationship MCQs.
Beneficiary. The beneficiary is the one who benefits. Understanding the flow of benefit is useful for Banker Customer Relationship MCQs.
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What is the bank’s role when appointed to manage the estate of a deceased person?
Explanation
Correct: A
Trustee/Executor/Administrator. The bank takes on these roles in estate management. These specialized roles appear in higher-level Banker Customer Relationship MCQs.
Trustee/Executor/Administrator. The bank takes on these roles in estate management. These specialized roles appear in higher-level Banker Customer Relationship MCQs.
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In a bank’s safe deposit locker facility, what is the customer who uses the locker called?
Explanation
Correct: B
Lessee. The customer renting the locker is the lessee. Remember the “Lessee” suffix for the user in Banker Customer Relationship MCQs.
Lessee. The customer renting the locker is the lessee. Remember the “Lessee” suffix for the user in Banker Customer Relationship MCQs.
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When a customer entrusts valuables to the bank for safekeeping (not as a pledge or in a locker), the bank is the:
Explanation
Correct: D
Bailee. The bank becomes the bailee, responsible for the goods. This specific legal term is a must-know for Banker Customer Relationship MCQs.
Bailee. The bank becomes the bailee, responsible for the goods. This specific legal term is a must-know for Banker Customer Relationship MCQs.
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The customer who receives financial advice from the bank is the:
Explanation
Correct: B
Client. The customer is the client receiving advice. This professional relationship is the basis of advisory Banker Customer Relationship MCQs.
Client. The customer is the client receiving advice. This professional relationship is the basis of advisory Banker Customer Relationship MCQs.
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When a bank provides a guarantee or indemnity, it acts as the:
Explanation
Correct: A
Indemnitor. The bank provides the indemnity. This role carries financial risk, a concept analyzed in Banker Customer Relationship MCQs.
Indemnitor. The bank provides the indemnity. This role carries financial risk, a concept analyzed in Banker Customer Relationship MCQs.
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In an assignment, the party to whom a right/debt is transferred is the:
Explanation
Correct: B
Assignee. The assignee receives the right or debt. Keep the “ee” (receiver) vs “or” (giver) rule in mind for Banker Customer Relationship MCQs.
Assignee. The assignee receives the right or debt. Keep the “ee” (receiver) vs “or” (giver) rule in mind for Banker Customer Relationship MCQs.
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Which law is most relevant to the concept of Indemnity in banking transactions?
Explanation
Correct: B
Contract Law. Contract Law governs indemnity agreements. This links the legal theory to practice in Banker Customer Relationship MCQs.
Contract Law. Contract Law governs indemnity agreements. This links the legal theory to practice in Banker Customer Relationship MCQs.
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⚡ Quick Revision: Key Facts for Banker Customer Relationship MCQs
Deposit: In a deposit account, the Bank is the Debtor and the Customer is the Creditor.
Loan: When a loan is granted, the Bank becomes the Creditor and the Customer is the Debtor.
Locker: For Safe Deposit Lockers, the relationship is Lessor (Bank) and Lessee (Customer).
Pledge: Pledging goods makes the Customer the Pledger and the Bank the Pledgee.
Mortgage: In a mortgage, the Customer is the Mortgagor and the Bank is the Mortgagee.
Collection: When collecting checks, the Bank acts as an Agent for the Principal (Customer).
Safekeeping: For articles left for safe custody, the Bank is the Bailee and the Customer is the Bailor.
Hypothecation: Hypothecation involves movable assets where possession remains with the Borrower.
❓ Frequently Asked Questions
Why is Banker Customer Relationship MCQs critical for Bank Exams?
It is a high-scoring area. Mastering Banker Customer Relationship MCQs ensures better performance in the objective papers of IBPS and SBI.
Does this test cover the full syllabus?
Yes, these Banker Customer Relationship MCQs questions cover the most repeated concepts found in previous years’ papers.
What is the difference between Pledge and Hypothecation?
In a pledge, possession transfers to the bank (pledgee). In hypothecation, possession remains with the customer. Both are key topics in Banker Customer Relationship MCQs.
Are these questions relevant for Promotion Exams?
Absolutely. Internal promotion exams frequently test practical knowledge of relationships like Bailor-Bailee and Lessor-Lessee covered in these Banker Customer Relationship MCQs.