Hello and welcome to exampundit. Here is a set of English Language Quiz for the upcoming IBPS Exams 2017.
DIRECTIONS (Q. 1-15): Read the following passage based on an
Interview to answer the given questions based on it. Certain words are printed
in bold to help you locate them while answering some of the questions.
Interview to answer the given questions based on it. Certain words are printed
in bold to help you locate them while answering some of the questions.
A spate of farmer sucides linked
to harassment by recovery agents employed by Micro Finance Institutions (MFIs)
in Andhra Pradesh spurred the state
government to bring in regulation to protect consumer interests. But, while the
Bill has brought into sharp focus the need for consumer protection, it tries to
micro-manage MFI operations and in the process it could scuttle some of the crucial benefits that MFls bring to farmers,
says the author of Microfinance India, State of the Sector Report 2010. In an
interview he points out that prudent regulation can ensure the original goal of
the MFIs–social uplift of the poor.
to harassment by recovery agents employed by Micro Finance Institutions (MFIs)
in Andhra Pradesh spurred the state
government to bring in regulation to protect consumer interests. But, while the
Bill has brought into sharp focus the need for consumer protection, it tries to
micro-manage MFI operations and in the process it could scuttle some of the crucial benefits that MFls bring to farmers,
says the author of Microfinance India, State of the Sector Report 2010. In an
interview he points out that prudent regulation can ensure the original goal of
the MFIs–social uplift of the poor.
Do you feel the AP Bill to regulate MFIs is well thought out ? Does it
ensure fairness to the borrowers and the long-term health of the sector ?
ensure fairness to the borrowers and the long-term health of the sector ?
The AP bill has brought into
sharp focus the need for customer protection in four critical areas First is
pricing. Second is tender’s liability — whether the Lender can give too much
loan without assessing the customer’s ability to pay. Third is the structure of
loan repayment – whether you can ask money on a weekly basis from people who
don’t produce weekly incomes. Fourth is the practices that attend to how you
deal with defaults. But the Act should have looked at the positive benefits
that institutions could bring in, and where they need to be regulated in the
interests of the customers. It should have brought only those features in.
sharp focus the need for customer protection in four critical areas First is
pricing. Second is tender’s liability — whether the Lender can give too much
loan without assessing the customer’s ability to pay. Third is the structure of
loan repayment – whether you can ask money on a weekly basis from people who
don’t produce weekly incomes. Fourth is the practices that attend to how you
deal with defaults. But the Act should have looked at the positive benefits
that institutions could bring in, and where they need to be regulated in the
interests of the customers. It should have brought only those features in.
Say, you want the recovery
practices to be consistent with what the customer can really manage. If the customer is aggrieved
and complains that somebody is harassing him, then those complaints should be
investigated by the District Rural Development Authority.
practices to be consistent with what the customer can really manage. If the customer is aggrieved
and complains that somebody is harassing him, then those complaints should be
investigated by the District Rural Development Authority.
Instead what the Bill says is
that MFIs cannot go to the customer’s premises to ask for recovery and that all
transactions will be done in the Panchayat office. With great difficulty, MFIs
brought services to the door of people. It is such a relief for the customers
not to be spending time out going to banks or Panchayat offices, which could be
10 km away in some cases. A facility which has brought some relief to people is
being shut. Moreover, you are practically telling the MFI where it should do
business and how it should do it.
that MFIs cannot go to the customer’s premises to ask for recovery and that all
transactions will be done in the Panchayat office. With great difficulty, MFIs
brought services to the door of people. It is such a relief for the customers
not to be spending time out going to banks or Panchayat offices, which could be
10 km away in some cases. A facility which has brought some relief to people is
being shut. Moreover, you are practically telling the MFI where it should do
business and how it should do it.
Social responsibilities were in-built when the MFIs were first
conceived. If MFIs go for profit with loose regulations, how are they different
from moneylenders?
conceived. If MFIs go for profit with loose regulations, how are they different
from moneylenders?
Even among moneylenders there are
very good people who take care of the customer’s circumstance, and there are
really bad ones. A large number of the MFIs are good and there are some who are
coercive because of the kind of
prices and processes they have adopted. But Moneylenders never got this
organised. They did not have such a large footprint. An MFI brought in
organisations, it mobilized the equity, it brought in commercial funding. It
invested in systems. It appointed a large number of people. But some of then exacted a much higher price than they
should have. They wanted to break even very fast and greed did take over in
some cases.
very good people who take care of the customer’s circumstance, and there are
really bad ones. A large number of the MFIs are good and there are some who are
coercive because of the kind of
prices and processes they have adopted. But Moneylenders never got this
organised. They did not have such a large footprint. An MFI brought in
organisations, it mobilized the equity, it brought in commercial funding. It
invested in systems. It appointed a large number of people. But some of then exacted a much higher price than they
should have. They wanted to break even very fast and greed did take over in
some cases.
Are the for-profit MFIs the only ones harassing people for recoveries ?
Some not-for-profit outfits have
also adopted the same kind of recovery methods. That may be because you have to
show that you are very efficient in your recovery methods and that your
portfoilo is of a very high quality if you want to get commercial funding from
a bank. In fact, among for-profits there are many who have sensible recovery
practices. Some have fortnightly recovery, some have monthly recovery. So we
have differing practices. We just describe a few dominant ones and assume every
for-profit MFI operates like that.
also adopted the same kind of recovery methods. That may be because you have to
show that you are very efficient in your recovery methods and that your
portfoilo is of a very high quality if you want to get commercial funding from
a bank. In fact, among for-profits there are many who have sensible recovery
practices. Some have fortnightly recovery, some have monthly recovery. So we
have differing practices. We just describe a few dominant ones and assume every
for-profit MFI operates like that.
How can you introduce regulations to ensure social upliftment in a
sector that is moving towards for -profit models ?
sector that is moving towards for -profit models ?
I am not really concerned whether
someone wants to make a profit or not. The bottom-line for me is customer
protection. The first area is fair practices. Are you telling your customers
how the loan is structured ? Are you being transparent about your performance ?
There should also be a lender’s lilability attached to what you do. Suppose you
lend excessively to a customer without assessing their ability to service the
loan, you have to take the hit. Then there’s the question of limiting returns.
You can say that an MFI cannot have a return on assets more than X, a return on
equity of more than Y. Then suppose there is a privately promoted MFI, there
should be a regulation to ensure the MFI cannot access equity markets till a certain
amount of time. MFIs went to markets perhaps because of the need to grow too
big too fast. The government thought they were making profit off the poor, and
that’s an indirect reasons why they decided to clamp down on MFIs. If you say
an MFI won’t go to capital market, then it will keep political compulsions under rein.
someone wants to make a profit or not. The bottom-line for me is customer
protection. The first area is fair practices. Are you telling your customers
how the loan is structured ? Are you being transparent about your performance ?
There should also be a lender’s lilability attached to what you do. Suppose you
lend excessively to a customer without assessing their ability to service the
loan, you have to take the hit. Then there’s the question of limiting returns.
You can say that an MFI cannot have a return on assets more than X, a return on
equity of more than Y. Then suppose there is a privately promoted MFI, there
should be a regulation to ensure the MFI cannot access equity markets till a certain
amount of time. MFIs went to markets perhaps because of the need to grow too
big too fast. The government thought they were making profit off the poor, and
that’s an indirect reasons why they decided to clamp down on MFIs. If you say
an MFI won’t go to capital market, then it will keep political compulsions under rein.
1. Which of the following best
explains ‘Structure of loan repayment’ in the context of the first question
asked to the author ?
explains ‘Structure of loan repayment’ in the context of the first question
asked to the author ?
(a) Higher interest rate
(b) Payment on weekly basis
(c) Giving loan without assessing
ability to pay
ability to pay
(d) Method of dealing with
defaults
defaults
(e) Total amount of loan
2. The author is of the view that
_____
_____
(a) the bill to regulate MFIs is
not needed
not needed
(b) the bill neglects the
interests of the customers
interests of the customers
(c) the positive aspects of MFIs
should also be considered.
should also be considered.
(d) most of the MFIs are not
good.
good.
(e) MFIs must be told what and
where they should do business
where they should do business
3. One of the distinct positive
feature of MFIs is that _____.
feature of MFIs is that _____.
(a) they brought services to the
door of people
door of people
(b) they dealt with defaulters
very firmly
very firmly
(c) they provided adequate
customer protection
customer protection
(d) they are governed by the
local people
local people
(e) they have highly flexible
repayment plan
repayment plan
4. What is the difference between
MFIs and moneylenders ?
MFIs and moneylenders ?
(a) There is no difference.
(b) A large number of money
lenders are good whereas only a few MFIs are good
lenders are good whereas only a few MFIs are good
(c) Money lenders gave credit at
lower rate of interest than that of MFIs
lower rate of interest than that of MFIs
(d) MFIs adopted a structure and
put a process in place, which was not the case with moneylenders
put a process in place, which was not the case with moneylenders
(e) Moneylender appointed large
number of local people as against more outside people in MFIs
number of local people as against more outside people in MFIs
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5. Which of the following is positive
outcome of the AP Bill to regulate MFIs ?
outcome of the AP Bill to regulate MFIs ?
(a) The banks have started this
service in remote areas
service in remote areas
(b) It highlighted some areas of
customer protection
customer protection
(c) It highlighted the bad
practices being followed bymoneylenders
practices being followed bymoneylenders
(d) MFIs is invested in systems
and brought in commercial funding.
and brought in commercial funding.
(e) It will help convert MFIs
into small banks
into small banks
6. The author is recommending
____.
____.
(a) Not-for profit MFIs
(b) For-profit MFIs
(c) Stoppage of commercial
funding to MFIs
funding to MFIs
(d) Customer satisfaction irrespective
of ‘Not-for profit’ or ‘for profit’ MFIs
of ‘Not-for profit’ or ‘for profit’ MFIs
(e) Public sector promoted MFIs
7. Why did MFIs go to the equity
markers ?
markers ?
(a) To repay the loan
(b) To lower interest rate
(c) There were political
compulsions
compulsions
(d) To become a public sector
institution
institution
(e) To grow very fast
8. Which of the following has not been indicated as one of the
features of air practices for customer protection ?
features of air practices for customer protection ?
(a) Providing information about
loan structuring.
loan structuring.
(b) MFIs should also be held liable
for some of their actions
for some of their actions
(c) Not to raise money from
capital market
capital market
(d) MFIs should also inform
public about their own performance also
public about their own performance also
(e) To provide credit as per the
rational assessment of their ability to service the loan
rational assessment of their ability to service the loan
9. Which of the following could
possibly be most plausible reason for banning recovery by going to customer’s premises
?
possibly be most plausible reason for banning recovery by going to customer’s premises
?
(a) To protect the family members
(b) To protect the customer from
harassment and coercion
harassment and coercion
(c) To reduce the undue expenses
of MFIs is resulting in lower interest rates.
of MFIs is resulting in lower interest rates.
(d) To account systematically the
money recovered in the books of accounts
money recovered in the books of accounts
(e) To keep Panchayat office out
of these transactions
of these transactions
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DIRECTIONS (Q. 10-13): Choose the word which is most nearly the
same in meaning as the word/group of words printed in bold.
same in meaning as the word/group of words printed in bold.
10. manage
(a) afford (b) assess
(c) thrust (d) administer
(e) use
11. exacted
(a) perfected (b) demanded
(c) estimated (d) corrected
(e) accurate
12. scuttle
(a) delay (b) mix
(c) shuffle (d) destroy
(e) smoothen
13. spurred
(a) agitated (b) instigated
(c) reflected (d) disapproved
(e) prompted
DIRECTIONS (Q. 14-15): Choose the word or group of words which is
most opposite in meaning of the word printed in bold.
most opposite in meaning of the word printed in bold.
14. under rein
(a) under wrap
(b) without target
(c) let loose
(d) no cloud
(e) under cloud
15. coercive
(a) gentle (b) promoting
(c) progressive (d) natural
(e) opinionated
Answers:
1. (b)
2. (c)
3. (a)
4. (d)
5. (b)
6. (d)
7. (e)
8. (d)
9. (b)
10. (a)
11. (b)
12. (d)
13. (e)
14. (c)
15. (a)
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