NRB Act, 2058 MCQs: 100 Questions and Answers for Banking Exam Preparation

Looking for NRB Act 2058 MCQs? We have compiled 100 high-yield questions focusing on the functions, duties, and powers of Nepal Rastra Bank. This resource includes detailed coverage of the Board of Directors, currency issuance, and the legal provisions governing the financial sector in Nepal.

1. When was the Nepal Rastra Bank Act, 2058, authenticated and published?

A) 2058 Magh 1

B) 2058 Magh 17

C) 2059 Baishakh 14

D) 2058 Chaitra 30

 

2. Which section of the Act defines the "Objectives of the Bank"?

A) Section 3

B) Section 4

C) Section 5

D) Section 7

 

3. According to the Act, what is the primary objective of NRB?

A) To maximize government revenue

B) To provide loans to the general public

C) To maintain the stability of the price and balance of payment

D) To manage the stock exchange of Nepal

 

4. NRB is an autonomous and corporate body with:

A) Limited liability

B) Perpetual succession

C) Temporary existence

D) Government-only ownership

 

5. Where must the Central Office of Nepal Rastra Bank be located according to the Act?

A) Any major city

B) Kathmandu

C) Lalitpur

D) Singha Durbar

 

6. Who acts as the "Lender of the Last Resort"?

A) Ministry of Finance

B) Nepal Rastra Bank

C) Commercial Banks

D) International Monetary Fund (IMF)

 

7. Which of the following is NOT a function of NRB?

A) Issuing banknotes and coins

B) Formulating monetary policy

C) Opening accounts for individuals

D) Managing foreign exchange reserves

 

8. How many members are on the Board of Directors of NRB?

A) 5 members

B) 7 members

C) 9 members

D) 11 members

 

9. Who is the Chairperson of the NRB Board?

A) Finance Secretary

B) Governor

C) Deputy Governor

D) Finance Minister

 

10. What is the tenure of the Governor of NRB?

A) 4 years

B) 5 years

C) 6 years

D) 3 years

 

11. Who appoints the Governor of NRB?

A) The President of Nepal

B) The Finance Minister

C) Government of Nepal (Council of Ministers)

D) The Public Service Commission

 

12. The Recommendation Committee for the appointment of the Governor is headed by:

A) The Prime Minister

B) The Finance Minister

C) A Retired Chief Justice

D) The Finance Secretary

 

13. How many Deputy Governors are appointed in NRB?

A) 1

B) 2

C) 3

D) 4

 

14. Who recommends names for the appointment of Deputy Governor?

A) Ministry of Finance

B) The Board of Directors

C) The Governor

D) The Prime Minister

 

15. What is the minimum educational qualification required to be a Director of NRB?

A) Bachelor's Degree

B) Master's Degree

C) PhD

D) Professional Certification (CA/ACCA)

 

16. Which section of the Act mentions the "Disqualification of the Directors"?

A) Section 15

B) Section 20

C) Section 21

D) Section 25

 

17. A person holding what percentage of shares in a commercial bank is disqualified from being a Director of NRB?

A) 1% or more

B) 5% or more

C) 10% or more

D) Any percentage

 

18. Who removes the Governor from office?

A) The Board of Directors

B) The Supreme Court

C) Government of Nepal (Council of Ministers)

D) The Parliament

 

19. On what grounds can a Governor be removed?

A) Lack of capability to implement Bank functions

B) Dishonesty or mala fide intention

C) Absence from three consecutive Board meetings without reason

D) All of the above

 

20. Before removing a Governor, the government must constitute an:

A) Audit Committee

B) Inquiry Committee

C) Management Committee

D) Parliamentary Committee

 

21. To whom does the Governor submit his/her resignation?

A) The President

B) The Board of Directors

C) Government of Nepal

D) The Finance Minister

 

22. What is the quorum for a meeting of the NRB Board?

A) At least 3 Directors

B) At least 4 Directors

C) Majority of the members

D) 5 members

 

23. Who presides over the Management Committee of NRB?

A) Senior Deputy Governor

B) Finance Secretary

C) Governor

D) Executive Director

 

24. The Audit Committee of NRB is chaired by:

A) The Governor

B) A Director designated by the Board

C) The Deputy Governor

D) The Auditor General

 

25. What is the authorized capital of Nepal Rastra Bank as per the Act?

A) 1 Billion Rupees

B) 3 Billion Rupees

C) 5 Billion Rupees

D) 10 Billion Rupees

 

26. Who provides the capital for Nepal Rastra Bank?

A) Public Shares

B) Commercial Banks

C) Government of Nepal

D) Foreign Aid

 

27. In which fund must 5% of the net profit be kept?

A) General Reserve Fund

B) Monetary Liability Fund

C) Financial Stability Fund

D) Revaluation Reserve Fund

 

28. Who carries out the auditing of NRB's accounts?

A) Internal Auditor only

B) A Private CA firm

C) The Auditor General of Nepal

D) The Finance Ministry

 

29. Within how many months must the annual report be submitted to the Government?

A) 2 months

B) 3 months

C) 4 months

D) 6 months

 

30. Who has the monopoly over the issue of banknotes and coins in Nepal?

A) Ministry of Finance

B) Nepal Rastra Bank

C) Nepal Bank Limited

D) Global IME Bank

 

31. At least what percentage of security must be kept against the value of issued notes?

A) 25%

B) 50%

C) 75%

D) 100%

 

32. Which of the following can be kept as security for issuing currency?

A) Gold and Silver

B) Foreign Currency

C) Securities issued by Govt of Nepal

D) All of the above

 

33. The monetary unit of Nepal is:

A) Mohar

B) Rupee

C) Paisa

D) Dollar

 

34. NRB classifies financial institutions into how many categories?

A) 2

B) 3

C) 4

D) 5

 

35. Commercial banks are classified as: A) Class 'A' B) Class 'B' C) Class 'C' D) Class 'D'

36. Development banks are classified as:

A) Class 'A'

B) Class 'B'

C) Class 'C'

D) Class 'D'

 

37. Finance companies are classified as:

A) Class 'A'

B) Class 'B'

C) Class 'C'

D) Class 'D'

 

38. Microfinance financial institutions are classified as:

A) Class 'A'

B) Class 'B'

C) Class 'C'

D) Class 'D'

 

39. Which act governs the establishment of banks in Nepal?

A) NRB Act 2058

B) BAFIA 2073

C) Company Act 2063

D) Contract Act 2056

 

40. What is the full form of BAFIA?

A) Banking and Financial Investment Act

B) Banking and Financial Institutions Act

C) Bank and Finance Information Agency

D) Bank Assets and Finance Institutions Act

 

41. The current Fiscal Year in Nepal starts from:

A) Baishakh 1

B) Shrawan 1

C) Magh 1

D) Poush 1

 

42. Who is the current Governor of NRB (as of early 2026)?

A) Maha Prasad Adhikari

B) Dr. Biswo Nath Poudel

C) Dr. Chiranjibi Nepal

D) Dr. Yuba Raj Khatiwada

 

43. Which department in NRB is responsible for bank supervision?

A) Banking Department

B) Bank Supervision Department

C) Currency Management Department

D) General Services Department

 

44. CRR stands for:

A) Cash Reserve Ratio

B) Credit Risk Ratio

C) Currency Reserve Rate

D) Capital Reserve Ratio

 

45. SLR stands for:

A) Standard Liquidity Rate

B) Statutory Liquidity Ratio

C) Simple Loan Rate

D) Secure Loan Ratio

 

46. What is the main tool used by NRB to control inflation?

A) Fiscal Policy

B) Monetary Policy

C) Industrial Policy

D) Trade Policy

 

47. Repo and Reverse Repo are instruments of:

A) Long term credit

B) Open Market Operations

C) Capital Market

D) Foreign Aid

 

48. In a "Repo" transaction, NRB:

A) Sells securities to absorb liquidity

B) Buys securities to inject liquidity

C) Lends money to the government

D) Issues new currency

 

49. In a "Reverse Repo" transaction, NRB:

A) Injects liquidity

B) Absorbs liquidity

C) Increases the interest rate

D) Reduces the CRR

 

50. What is "Base Rate"?

A) The minimum rate at which banks can lend

B) The interest rate for deposits

C) The rate charged by NRB to banks

D) The rate for government bonds

 

51. KYC stands for:

A) Know Your Company

B) Know Your Customer

C) Keep Your Cash

D) Know Your Credit

 

52. AML stands for:

A) Asset Management Law

B) Anti-Money Laundering

C) Account Management Limit

D) Annual Money Ledger

 

53. Which organization globally sets standards for AML?

A) IMF

B) World Bank

C) FATF

D) WTO

 

54. What is the full form of RTGS?

A) Real Time Gross Settlement

B) Real Time Gold Standard

C) Regional Trade Gross System

D) Rapid Transfer General System

 

55. Which bank is known as the first bank of Nepal?

A) Nepal Bank Limited

B) Nepal Rastra Bank

C) Rastriya Banijya Bank

D) Agricultural Development Bank

 

56. Nepal Bank Limited was established in:

A) 1990 BS

B) 1994 BS

C) 2013 BS

D) 2022 BS

 

57. When was Rastriya Banijya Bank established?

A) 2013 BS

B) 2022 BS

C) 2031 BS

D) 2041 BS

 

58. Who was the first Governor of NRB?

A) Laxmi Nath Gautam

B) Himalaya Shumsher J.B. Rana

C) Bhekh Bahadur Thapa

D) Yadav Prasad Pant

 

59. Which section of the NRB Act deals with "Confidentiality"?

A) Section 30

B) Section 35

C) Section 38

D) Section 45

 

60. The "Fiscal Year" of NRB ends on:

A) Mid-April

B) Mid-July (Ashad end)

C) Mid-January

D) December 31

 

61. What is "Spread Rate"?

A) Difference between deposit and lending rates

B) Difference between CRR and SLR

C) Difference between Base Rate and Market Rate

D) The rate of currency fluctuation

 

62. Which of the following is an "Indirect" tool of monetary policy?

A) Credit Ceiling

B) Interest Rate Corridor

C) Direct Lending

D) Moral Suasion

 

63. "Bank Rate" is the rate at which:

A) Banks lend to the public

B) NRB lends to banks

C) Banks lend to each other

D) Government borrows from NRB

 

64. The "Credit to Deposit (CD) Ratio" limit for banks is currently around:

A) 70%

B) 80%

C) 90%

D) 100%

 

65. "NPA" in banking stands for:

A) New Policy Account

B) Non-Performing Assets

C) Net Profit Amount

D) National Payment Agency

 

66. A loan is considered "Non-Performing" if the interest/principal is overdue for more than:

A) 30 days

B) 60 days

C) 90 days

D) 120 days

 

67. What is "Microfinance"?

A) Financing large industries

B) Financial services for low-income individuals

C) Managing government budget

D) Foreign exchange trading

 

68. The "Credit Information Center" (CIC) is established to:

A) Provide loans to the public

B) Collect and share credit history of borrowers

C) Regulate the stock market

D) Print currency

 

69. Which section of the Act discusses the "Prior Right of the Bank" for recovering loans?

A) Section 5

B) Section 6

C) Section 10

D) Section 12

 

70. NRB is exempted from paying:

A) Income Tax

B) Registration Fees

C) Revenue Stamps

D) All of the above

 

71. Any contact between the Government and NRB must be made through:

A) The Prime Minister's Office

B) The Ministry of Finance

C) The Parliament

D) The Nepal Stock Exchange

 

72. Who can alter the capital of NRB?

A) The Governor

B) The Board of Directors

C) Government of Nepal (with consultation)

D) The IMF

 

73. "Monetary Liability" includes:

A) Bank notes and coins in circulation

B) Fixed assets of the bank

C) Foreign reserves

D) Staff salaries

 

74. The "Acting Governor" is designated from among the:

A) Board Members

B) Senior Deputy Governor

C) Finance Secretary

D) Retired Governors

 

75. What is the maximum period a Governor can be reappointed?

A) No limit

B) One term

C) Two terms

D) Cannot be reappointed

 

76. Which section prohibits a Governor from working in a commercial bank after retirement?

A) Section 100

B) Section 106

C) Section 110

D) Section 112

 

77. How long must a Deputy Governor wait after retirement to work in a commercial bank?

A) 1 year

B) 2 years

C) 3 years

D) Permanent bar

 

78. The "Oath of Office" for the Governor is taken before the:

A) President

B) Prime Minister

C) Chief Justice of the Supreme Court

D) Finance Minister

 

79. "Legal Tender" means:

A) A loan agreement

B) Currency that must be accepted for payment of debt

C) A bank's license

D) A court order

 

80. Which of the following is a "Liability" for NRB?

A) Gold Reserve

B) Foreign Currency

C) Currency in Circulation

D) Government Bonds

 

81. NRB was established under which Act?

A) Nepal Rastra Bank Act 2012

B) Nepal Rastra Bank Act 2058

C) Commercial Bank Act 2031

D) Company Act 2021

 

82. The "Preamble" of the NRB Act 2058 mentions:

A) Sustainable development of Nepal

B) Maximizing bank profits

C) Reducing government debt

D) Expanding international trade

 

83. Who is the "Fiscal Agent" of the Government of Nepal?

A) Nepal Bank Ltd

B) Rastriya Banijya Bank

C) Nepal Rastra Bank

D) ADBL

 

84. "Foreign Exchange" includes:

A) Foreign Currency

B) SDRs (Special Drawing Rights)

C) Travelers Cheques in foreign currency

D) All of the above

 

85. "Convertible Foreign Currency" is prescribed by:

A) The Ministry of Finance

B) Nepal Rastra Bank

C) The IMF

D) The World Bank

 

86. Section 52 of the Act gives NRB the power to:

A) Inspect banks

B) Issue banknotes and coins

C) Appoint staff

D) Invest in shares

 

87. "SDR" stands for:

A) Special Deposit Rate

B) Special Drawing Rights

C) Standard Deposit Ratio

D) Systemic Debt Relief

 

88. Who is the current Chairperson of the "Inquiry Committee" for removing a Governor?

A) Finance Minister

B) A person designated by Govt from among retired Supreme Court Justices

C) The Prime Minister

D) The Auditor General

 

89. NRB can provide credit to the Government for a maximum of:

A) 90 days

B) 180 days

C) 1 year

D) 5 years

 

90. Which of the following is an asset for NRB?

A) Notes in circulation

B) Reserve funds

C) Foreign Exchange Reserve

D) Deposits of commercial banks

 

91. The "Interest Rate Corridor" has which upper limit?

A) Deposit Collection Rate

B) Repo Rate

C) Bank Rate (Standing Liquidity Facility)

D) Inflation Rate

 

92. SWIFT stands for:

A) Society for Worldwide Interbank Financial Telecommunication

B) System for Worldwide Interbank Financial Transfer

C) Secure Worldwide Interbank Financial Transaction

D) Standard Worldwide Interbank Financial Telecommunication

 

93. Which section allows NRB to frame "Rules and Bye-laws"?

A) Section 100

B) Section 105

C) Section 109

D) Section 110

 

94. "M1" money supply includes:

A) Currency + Demand Deposits

B) Currency + Fixed Deposits

C) Fixed Deposits + Savings

D) Total Bank Assets

 

95. "M2" money supply is also known as:

A) Narrow Money

B) Broad Money

C) Plastic Money

D) Reserve Money

 

96. The "Capital Adequacy Ratio" (CAR) for commercial banks in Nepal is currently:

A) 8%

B) 10%

C) 11%

D) 15%

 

97. "Bancassurance" is:

A) A type of bank loan

B) Selling insurance products through banks

C) A government guarantee for banks

D) A merger of two banks

 

98. "Dematerialized" (Demat) accounts are used for:

A) Keeping cash

B) Holding shares in electronic form

C) Foreign exchange

D) Paying taxes

 

99. Which of the following is NOT a licensed category by NRB?

A) Class A

B) Class B

C) Class E

D) Class D

 

100. The "Financial Stability Fund" is used for:

A) Staff bonuses

B) Supporting the stability of the financial system

C) Building new offices

D) Paying international debt

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Answer Key:

Q	Ans	Q	Ans	Q	Ans	Q	Ans	Q	Ans
1	B	21	C	41	B	61	A	81	A
2	B	22	A	42	B	62	B	82	A
3	C	23	C	43	B	63	B	83	C
4	B	24	B	44	A	64	C	84	D
5	B	25	C	45	B	65	B	85	B
6	B	26	C	46	B	66	C	86	B
7	C	27	B	47	B	67	B	87	B
8	B	28	C	48	B	68	B	88	B
9	B	29	C	49	B	69	B	89	B
10	B	30	B	50	A	70	D	90	C
11	C	31	B	51	B	71	B	91	C
12	B	32	D	52	B	72	C	92	A
13	B	33	B	53	C	73	A	93	D
14	C	34	C	54	A	74	B	94	A
15	B	35	A	55	A	75	B	95	B
16	C	36	B	56	B	76	B	96	C
17	B	37	C	57	B	77	C	97	B
18	C	38	D	58	B	78	C	98	B
19	D	39	B	59	C	79	B	99	C
20	B	40	B	60	B	80	C	100	B

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