Finance Study Desk Quick Revision

Revise More in Less Time

Short revision notes for banking, economy and financial concepts. Use this page after studying a topic to refresh the distinction, definition and exam logic without reading the entire lesson again.

Choose a Revision Area

BANKING

Banking in 5 Minutes

RBI, CRR, SLR, repo, NPA, deposits and payment systems.

ECONOMY

Economy in 5 Minutes

GDP, inflation, fiscal policy, monetary policy and exchange rates.

MARKETS

Markets in 5 Minutes

Shares, bonds, mutual funds, NAV, IPOs and market basics.

CRR vs SLR

Two similar abbreviations, but they should not be remembered as the same requirement.

CRR

Full form: Cash Reserve Ratio

A prescribed portion of a bank’s relevant liabilities is maintained as cash balance with the Reserve Bank of India in accordance with the applicable framework.

Memory cue: Cash + RBI

SLR

Full form: Statutory Liquidity Ratio

Banks maintain the prescribed proportion in specified liquid assets in accordance with the statutory framework.

Memory cue: Liquid assets + Bank

Recall: CRR reminds you of cash maintained with RBI. SLR reminds you of the statutory liquid-asset requirement.

Repo vs Reverse Repo

Repo

Think of liquidity moving from RBI to eligible market participants, such as banks, under a repo transaction against eligible securities within the applicable framework.

Reverse Repo

Think of the transaction from the opposite direction. Understanding the direction is more useful than memorising two isolated definitions.

Exam technique: When repo terminology confuses you, first identify who is providing funds and who is receiving them.

What Is an NPA?

NPA = Non-Performing Asset

In banking, a loan or advance can become non-performing when it meets the regulatory criteria for non-performance.

For revision, remember the underlying idea first: the asset is no longer performing as expected according to the applicable repayment and regulatory criteria.

Do not permanently memorise a time period from an old study note. Asset-classification rules are regulatory information and should be checked against the current applicable RBI instructions when exact criteria are required.

NEFT, RTGS and IMPS

NEFT

An electronic funds-transfer system operated by RBI. Learn its settlement concept and use the latest official information for current operational features.

RTGS

Real Time Gross Settlement. The name itself is a useful memory cue: transactions are settled individually on a real-time gross basis.

IMPS

Immediate Payment Service provides an instant electronic funds transfer mechanism through participating institutions.

Memory method:
RTGS → Real Time + Gross
IMPS → Immediate
NEFT → Electronic fund transfer system

GDP in 2 Minutes

GDP = Gross Domestic Product

GDP measures the value of final goods and services produced within an economy over a specified period, subject to the statistical framework used for measurement.

For exam preparation, distinguish between concepts such as nominal and real GDP rather than treating every GDP figure as equivalent.

Remember: GDP tells us about economic output. It does not by itself tell us how equally income is distributed or whether every person’s living standard improved.

Inflation in 2 Minutes

Inflation refers broadly to a sustained increase in the general price level, reducing the purchasing power of money when other factors are unchanged.

CPI

Consumer Price Index tracks price changes using a basket designed to represent consumer prices under the relevant statistical methodology.

WPI

Wholesale Price Index measures price movements at the wholesale level for the goods covered by its methodology.

Memory picture: Same ₹500, smaller basket of goods.

Fiscal Policy vs Monetary Policy

Fiscal Policy

Think primarily of government taxation, expenditure and borrowing.

Cue: Government budget.

Monetary Policy

Think of central-bank policy relating to monetary and financial conditions within the statutory monetary-policy framework.

Cue: Central bank.

Share vs Bond

Share

A share represents an ownership interest in a company, subject to the rights attached to that class of shares.

Bond

A bond is a debt instrument through which the issuer borrows funds under specified terms.

Basic distinction: Share → ownership. Bond → debt.

Primary vs Secondary Market

Primary Market

Securities are issued to investors as part of the issuance process.

Secondary Market

Existing securities are subsequently traded among market participants.

Memory cue: Primary = issue. Secondary = trade.

IPO in 2 Minutes

IPO stands for Initial Public Offering.

An IPO is the process through which a company offers specified securities to the public for the first time under the applicable capital-market framework.

An IPO should not be confused with the later trading of those shares in the secondary market.

Mutual Fund in 2 Minutes

A mutual fund pools money from investors and invests according to the stated investment objective and scheme framework.

Investor money

↓
Mutual fund scheme

↓
Portfolio of investments

↓
Value represented through units and NAV

NAV

NAV = Net Asset Value

At a simplified conceptual level, NAV per unit represents the scheme’s net asset value attributable to each outstanding unit.

A fund with an NAV of ₹20 is not automatically cheaper or better than one with an NAV of ₹200. NAV alone is not a valuation comparison equivalent to comparing market prices of ordinary shares.

SIP, STP and SWP

SIP

Systematic Investment Plan

A method of investing specified amounts periodically into a mutual fund scheme.

STP

Systematic Transfer Plan

A facility for systematic transfers between eligible schemes subject to the applicable terms.

SWP

Systematic Withdrawal Plan

A facility for making systematic withdrawals from a mutual fund investment according to the selected arrangement.

Remember the verbs:
SIP → Invest
STP → Transfer
SWP → Withdraw

Risk and Return

Return is the gain or loss generated by an investment over a period. Risk concerns uncertainty about outcomes and the possibility that actual results differ from expectations.

Important: Higher potential return should not be interpreted as guaranteed higher return. Risk and return need to be considered together.

Ten One-Line Recall Cues

CRR Cash + RBI.
SLR Statutory liquid assets.
RTGS Real time + gross settlement.
GDP Economic output.
Inflation General price level.
Fiscal Policy Government budget side.
Monetary Policy Central-bank policy side.
Share Ownership.
Bond Debt.
NAV Net asset value per unit.

Test Yourself Without Looking Back

1. Which concept should immediately remind you of “Cash + RBI”?
CRR, or Cash Reserve Ratio.
2. What is the simplest distinction between a share and a bond?
A share represents ownership interest, while a bond is a debt instrument.
3. Which policy should make you think of government taxation and spending?
Fiscal policy.
4. What does the word “Gross” in RTGS help you remember?
Transactions are settled individually rather than being netted together for settlement.
5. Does a lower NAV automatically make one mutual fund cheaper than another?
No. NAV alone should not be used that way to compare mutual fund schemes.
6. What are the three verbs for SIP, STP and SWP?
Invest, Transfer and Withdraw.
7. Does GDP tell us how evenly income is distributed?
No. GDP measures economic output. Distribution requires additional measures and analysis.

How to Use Quick Revision

First

Study the complete topic from Exam Prep or your current official study material.

Then

Return here and try to recall the definition before reading the revision note.

Finally

Use the questions above. Anything you cannot retrieve becomes your next revision target.

Current facts can change.

Quick Revision focuses mainly on durable concepts. Policy rates, regulatory limits, examination patterns, tax rules, eligibility conditions and operational requirements can change. Verify such information from the relevant official source before an examination or financial decision.

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