Banking Notes / Banking Awareness / Chapter 8
Chapter 8 of 17

Banking Terminology & Important Financial Abbreviations

The reference glossary every other Banking Awareness chapter assumes you already know — full forms and quick definitions in one place.

📖 ~10 min read 🏛️ Banking Awareness

Introduction

This chapter is a working reference glossary — terms and abbreviations that appear throughout Banking Awareness and are frequently tested as standalone one-line questions.

Common Terms

TermMeaning
NPANon-Performing Asset — a loan where interest/principal is overdue for more than 90 days
ANBCAdjusted Net Bank Credit — the denominator used for calculating PSL targets
CASACurrent Account Savings Account — low-cost deposit base for a bank
CIBILCredit Information Bureau (India) Limited — maintains individual credit history/scores
KYCKnow Your Customer — mandatory identity verification process
NBFCNon-Banking Financial Company — lends/invests but cannot accept demand deposits
FEMAForeign Exchange Management Act, 1999 — governs foreign exchange transactions
MCLRMarginal Cost of Funds based Lending Rate — benchmark rate for bank loan pricing
IFSCIndian Financial System Code — 11-character code identifying a bank branch
NEFT/RTGS/IMPS/UPIElectronic fund transfer systems (see Chapter 6 for details)

More Key Abbreviations

AbbreviationFull Form
SARFAESISecuritisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002
ARCAsset Reconstruction Company
MSMEMicro, Small and Medium Enterprises
SHGSelf-Help Group
ATMAutomated Teller Machine
POSPoint of Sale
EMIEquated Monthly Instalment
Q. What does the abbreviation "SARFAESI" stand for, and what is its purpose?
SARFAESI stands for Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002. It allows banks and financial institutions to recover NPAs by seizing and selling secured assets without court intervention (in most cases).
⚠️ Key Insight: Terminology questions often test the full form AND the specific numeric detail attached to it (e.g., NPA's "90 days overdue" threshold) — memorise both together rather than the term alone.
✅ Practice Focus: Building a running glossary while studying other chapters · Full forms of frequently abbreviated terms · Numeric thresholds tied to definitions (like NPA's 90-day rule).

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