Module: | FCNR(B) & Special Provisions
Q11: Which of the following statements regarding remuneration for mobilizing deposits are correct?
1. Banks are generally prohibited from paying any commission, fees, or brokerage for mobilizing deposits.
2. An exception is made for commission paid to Direct Selling Agents under an outsourcing arrangement.
3. An exception is made for remuneration paid to Business Correspondents and Business Facilitators.
4. Banks are permitted to pay incentives to high-net-worth clients for introducing new deposit accounts.
2. An exception is made for commission paid to Direct Selling Agents under an outsourcing arrangement.
3. An exception is made for remuneration paid to Business Correspondents and Business Facilitators.
4. Banks are permitted to pay incentives to high-net-worth clients for introducing new deposit accounts.
✅ Correct Answer: C
Banks generally cannot pay commission for deposits, with exceptions for DSAs and Business Correspondents.
However, paying incentives to clients is prohibited.
This regulation ensures that Interest Rates on Deposits remain the primary tool for attracting customers, rather than under-the-table kickbacks.
This applies across all Domestic Term Deposits and savings products.
However, paying incentives to clients is prohibited.
This regulation ensures that Interest Rates on Deposits remain the primary tool for attracting customers, rather than under-the-table kickbacks.
This applies across all Domestic Term Deposits and savings products.