RBI Grade B Finance

Finance is one of the core components of the RBI Grade B phase 2 exam. To excel in the Finance section of the RBI Grade B exam, it is essential to have a thorough understanding of the finance concepts, practice of exam level finance questions and have a thorough analysis of the previous year’s questions of finance.

Below, we will cover all this to help you prepare for the Finance section of the RBI Grade B Phase 2 exam effectively.

But first, let’s briefly review the RBI Grade B exam pattern to understand the weightage of the Finance section.

RBI Grade B Pattern

RBI Grade B exam consists of:

• Phase 1
• Phase 2
• Interview

Out of these 3 stages, the Finance subject is part of Paper 3 of the RBI Grade B Phase 2 exam.

Details of RBI Grade B Paper 3:

• Total Questions:
  • 30 objective questions (Finance + Management)
  • 6 descriptive questions (3 questions each from Finance and Management) out of which 4 are to be attempted
• Marks:
  • Each objective question is worth 1 mark 
  • There are two 15-marker descriptive questions from finance
  • There is one 10-marker descriptive question from finance
• Time:
  • You have 30 minutes to complete the objective section and 90 minutes to complete the descriptive section.
  • There is no separate sectional timing for finance and management.
• Negative Marking:
  • 1/4th (0.25 marks) penalty for each incorrect objective answer
  • No negative marking for the descriptive answers

RBI Grade B Syllabus for Finance

Here is the detailed RBI Grade B Finance syllabus:

a) Financial System

1. Structure and Functions of Financial Institutions
2. Functions of the Reserve Bank of India
3. Banking System in India – Structure and Developments, Financial Institutions – SIDBI, EXIM Bank, NABARD, NHB, NaBFID, etc.
4. Recent Developments in the Global Financial System and its Impact on Indian Financial System
5. Role of Information Technology in Banking and Finance
6. Non-Banking System
7. Developments in Digital Payments

b) Financial Markets

1. Primary and Secondary Markets (Forex, Money, Bond, Equity, etc.), functions, instruments, and recent developments.

c) General Topics

1. Financial Risk Management
2. Basics of Derivatives
3. Global financial markets and International Banking – broad trends and latest developments
4. Financial Inclusion
5. Alternate source of finance, private and social cost-benefit, Public-Private Partnership
6. Corporate Governance in the Banking Sector
7. The Union Budget – Concepts, approach, and broad trends
8. Basics of Accounting and Financial Statements – Balance Sheet, Profit and Loss, Cash Flow Statements, Ratio Analysis (such as Debt to Equity, Debtor Days, Creditor Days, Inventory Turnover, Return on Assets, Return on Equity, etc.)
9. Inflation: Definition, trends, estimates, consequences, and remedies (control): WPI- CPI – components and trends; striking a balance between inflation and growth through monetary and fiscal policies.

Important Topics of Finance for RBI Grade B

We have analyzed the previous years’ questions (PYQs) to identify the important topics of finance for RBI Grade B:

Based on the above analysis, here are the most, moderately, and least important topics of finance for the RBI Grade B exam:

Most Important Topics of Finance (Objective) for RBI Grade B

• Introduction to the Indian Financial System 
• Primary and Secondary Market (Equity, Debt, and Forex Market) 
• Derivative Market (Future, Forward, Swaps, and Options) 
• Banking System in India – Structure and Developments
• RBI and it’s Functions
• Financial Institutions 
• Financial Risk Management
• Inflation

Moderately Important Topics of Finance (Objective) for RBI Grade B

• Bonds Market 
• Alternate Sources of Finance
• Non Banking System
• Financial Inclusion
• Development in the Digital Payment System
• Role of IT in Banking and Financial System
• Corporate Governance in Banks
• Introduction to Basics of Accounting
• Financial Statement – Income Statement
• Financial Statement – Balance Sheet
• Union Budget – Concepts, Approach, and Broad Trends
• Ratios Analysis
• Public Private Partnership

Least Important Topics of Finance (Objective) for RBI Grade B

• Time Value of Money
• Global Financial Market and International Banking
• Financial Statement – Cash Flow Statement
• Recent Developments in the Global Financial Market and its Impact on India

Most Important Topics of Finance (Descriptive) for RBI Grade B

• RBI and its Functions
• Financial Institutions 
• Financial Risk Management
• Development in the Digital Payment System
• Role of IT in Banking and Financial System
• Financial Inclusion
• Union Budget – Concepts, Approach, and Broad Trends

Moderately Important Topics of Finance (Descriptive) for RBI Grade B

• Bonds 
• Alternate Sources of Finance
• Non Banking System
• Primary and Secondary Market (Equity, Debt, and Forex Market) 
• Derivative Market (Future, Forward, Swaps, and Options) 
• Banking System in India – Structure and Developments
• Inflation
• Corporate Governance in Banks
• Recent Developments in the Global Financial Market and its Impact on India

Least Important Topics of Finance (Descriptive) for RBI Grade B

• Time Value of Money
• Global Financial Market and International Banking
• Financial Statement – Cash Flow Statement
• Ratios Analysis
• Public Private Partnership
• Introduction to Basics of Accounting
• Financial Statement – Income Statement
• Financial Statement – Balance Sheet

Best Finance Books for RBI Grade B

Here are the recommended books and resources to prepare for the Finance section of the RBI Grade B Phase 2 exam.

Other RBI Grade B Finance Preparation Resources

• Livemint 
• RBI Website
• Investopedia website
• The Hindu ePaper 
• Press Information Bureau Government of India

RBI Grade B Finance PYQs

Here are the topic-wise RBI Grade B Finance PYQs:

RBI Grade B Finance Concepts

Here are the topic-wise RBI Grade B Finance concepts:

RBI Grade B Finance Practice Questions

After understanding the concepts of each Finance topic, it’s crucial to practice a wide range of exam-level questions to:

• Reinforce your conceptual understanding.
• Gain exposure to different question types.
• Identify areas for improvement.
• Develop time management strategies.
• Enhance your problem-solving skills.
• Boost your confidence for the actual exam.

Here are the topic-wise RBI Grade B Finance practice questions:

Conclusion

We hope this information will help you get a complete picture of the Finance section of the RBI Grade B Phase 2 exam. By understanding the pattern, identifying key finance topics, learning concepts, and practicing exam-level questions, you can effectively prepare for this crucial section.