IBPS PO Prelims Full Mock Test 07

1. Read the following passage carefully and answer the questions given after it. For decades, a borrower's creditworthiness in India was judged by two things: a salary slip and a credit history. Millions of delivery riders, cab drivers and home-based workers who earn through digital platforms have neither. Their income arrives in small, irregular instalments, and because they have never taken a formal loan, credit bureaus have little to say about them. Lenders, unable to see the borrower clearly, either refuse or charge rates that reflect their own ignorance more than the borrower's risk. Cash-flow lending tries to close this gap. Instead of asking what a person earned last year, the lender looks at how money has moved through the account in recent months: how regularly payments arrive from the platform, how quickly bills are paid, and whether the balance ever runs dry. With the borrower's consent, this information can now be shared electronically through account aggregators, so a loan can be assessed in minutes rather than weeks. Supporters argue that this is the most practical way to bring the gig workforce into formal credit. A rider who has received payouts every week for two years is, in effect, demonstrating reliability that no salary slip could show. Lenders also gain, because a wider pool of well-understood borrowers lets them grow without taking blind risks. The approach is not free of hazards. Platform income can fall sharply if an app changes its incentive scheme, so a pattern that looks stable today may not survive a policy tweak tomorrow. There is also the question of how much a worker should be expected to reveal about his spending in exchange for a modest loan. Consent given on a phone screen in a hurry is not always informed consent. If cash-flow lending is to earn trust, lenders will have to explain clearly what data they use, keep it only as long as necessary, and resist the temptation to lend more simply because they can.

   Q1.Why have gig workers traditionally found it difficult to get formal loans, according to the passage?

   • A.They prefer to borrow from relatives
   • B.Their incomes are higher than the limit for small loans
   • C.They lack salary slips and credit histories, so lenders cannot judge them
   • D.They are not allowed to open bank accounts
   • E.Platforms forbid them from borrowing

2. Q2.What does cash-flow lending examine instead of last year's income?

   • A.The borrower's educational qualifications
   • B.The income of the borrower's family members
   • C.The number of apps on the borrower's phone
   • D.The value of the borrower's house
   • E.The recent pattern of money moving through the borrower's account

3. Q3.What role do account aggregators play in the process described?

   • A.They pay platform incentives to riders
   • B.They replace credit bureaus completely
   • C.They guarantee repayment of the loans
   • D.They let account information be shared electronically with the borrower's consent
   • E.They set interest rates for gig workers

Start the test to answer these. Correct answers and explanations are shown after you submit.