SBI PO Mains English Sectional Mock Test 03

1. Read the following passage carefully and answer the questions given after it. A few taps on a phone can now bring a personal loan within minutes. Digital lenders use data such as payment histories and phone usage to judge applicants who may never have borrowed from a bank. For young earners and small traders, this speed and access can be valuable. The model has also attracted abuse. Some apps, often unregistered, have charged hidden fees, lent at very high rates and used aggressive methods to recover dues, including calling a borrower's contacts. Several borrowers have been driven to despair by such practices. Regulators have tightened rules. Loans must now be disbursed and repaid directly through the bank account of a regulated lender, not through the app's own accounts. Borrowers must receive a key fact statement that sets out the total cost of the loan in simple terms, and there must be a cooling-off period during which a loan can be cancelled without penalty. Rules on paper need to be matched by awareness. A borrower who checks whether an app is linked to a regulated entity, reads the key fact statement and refuses to grant access to his contacts is far less likely to be trapped. Financial literacy, in this sense, is the first line of defence.

   Q1.What do digital lenders use to judge applicants who may never have borrowed from a bank?

   • A.Only property documents
   • B.Recommendations from neighbours
   • C.Their exam results
   • D.Data such as payment histories and phone usage
   • E.Their family size

2. Q2.Which of the following is mentioned as an abuse by some apps?

   • A.Providing key fact statements
   • B.Calling a borrower's contacts to recover dues
   • C.Disbursing through regulated banks
   • D.Lending at very low rates
   • E.Giving borrowers too much time

3. Q3.According to the new rules, how must loans be disbursed and repaid?

   • A.Directly through the bank account of a regulated lender
   • B.Through the app's own accounts
   • C.Only in cash
   • D.Through the borrower's employer
   • E.Through a cooperative society

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