Question

For more than three years (unsecured) doubtful advances, provision will be made for

A 10% Correct Answer Incorrect Answer
B 40% Correct Answer Incorrect Answer
C 100% Correct Answer Incorrect Answer
D 25%. Correct Answer Incorrect Answer
E 30% Correct Answer Incorrect Answer

Solution

As per the guidelines issued by the Reserve Bank of India (RBI), for doubtful advances, banks are required to make a provision based on the period for which the asset has remained doubtful. For unsecured advances that are considered doubtful for a period of more than three years, the provision to be made is 100%. This means that the bank must set aside an amount equal to 100% of the outstanding amount of the unsecured doubtful advance as a provision against possible losses.

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