Digital Financial Infrastructure

Unified Payments Interface (UPI) is expanding internationally, but only a few countries currently support international merchant payments under UPI. ✅ I. United Arab Emirates – Correct
* UPI is accepted at select merchants in the UAE via NPCI partnerships. ✅ II. France – Correct
* France allows UPI merchant payments at select tourist locations, like the Eiffel Tower. ❌ III. Germany – Incorrect
* No official rollout of UPI for merchant payments in Germany as of now. ✅ IV. Singapore – Correct
* UPI is live for both P2P remittances and merchant payments in Singapore. ❌ V. Bangladesh – Incorrect
* UPI is not yet operational for merchant payments in Bangladesh. International merchant payments are accepted under UPI in seven countries outside of India: Bhutan, France, Mauritius, Nepal, Singapore, Sri Lanka, and the UAE.

RTGS (Real Time Gross Settlement) and NEFT (National Electronic Funds Transfer) are two major electronic payment systems in India, differing mainly in settlement speed and mechanism. ✅ Statement I: Correct RTGS processes transactions instantly in real time, while NEFT settles in hourly batches, causing a time lag. ❌ Statement II: Incorrect Inward transactions (receiving money) are not charged in either RTGS or NEFT as per RBI guidelines. ❌ Statement III: Incorrect Both RTGS and NEFT are available 24x7x365, including on holidays.

* Statement 1 is correct. The digital rupee, also known as the e-rupee or Central Bank Digital Currency (CBDC), is indeed a sovereign currency issued by the RBI. It's a digital representation of India's fiat currency and is part of the RBI's monetary policy toolkit. * Statement 2 is correct. Like physical currency, the digital rupee is a liability on the RBI's balance sheet. When you hold digital rupees, it's essentially a claim you have on the RBI, similar to holding physical banknotes. * Statement 3 is incorrect. The digital rupee, by itself, doesn't come with inherent inflation protection. Its value, like physical currency, is subject to inflationary pressures. The RBI manages inflation through its monetary policy measures, not through the inherent design of the digital rupee. * Statement 4 is correct. The digital rupee is designed to be freely convertible. This means you can easily exchange it with bank deposits (commercial bank money) and cash at a 1:1 ratio without any restrictions. Therefore, the correct answer is (D) 1, 2 and 4.

* Transactions without US Dollar or SWIFT : Traditional digital payments often rely on the US dollar as a reserve currency and might involve the SWIFT system for international settlements. * A central bank digital currency (CBDC) is the digital form of a country's fiat currency. CBDCs have the potential to bypass these traditional channels. Transactions between countries using their own CBDCs could happen directly, reducing reliance on the US dollar and potentially making cross-border payments faster and cheaper. * Programmable Money with CBDCs : CBDCs can be programmed with certain features.  A central bank could issue a CBDC with a built-in spending time frame, for example, vouchers for specific purposes like public transport subsidies. These would expire after a certain period, ensuring the funds are used for the intended purpose.  * Therefore, CBDCs offer unique functionalities compared to traditional digital currencies. They can potentially streamline international payments and introduce programmable features for targeted uses.

In India, cyber insurance covers (generally) the following - Identity theft - Cyber-bullying and cyber-stalking - Cyber extortion - Malware intrusion - Financial loss due to unauthorized and fraudulent use of bank account, credit card, and mobile wallet - Legal expenses arising out of any covered risk - Social Media Cover - Phishing Cover - E-mail Spoofing - Media Liability Claims Cover - Cyber Extortion Cover - Privacy Breach and Data Breach by Third Party. Cyber insurance generally focuses on damages caused by cyber threats or electronic incidents, not physical damage to devices. Hence, statement 2 is incorrect. Hence only options 1, 3, and 4 are correct.

Statement 1 is Correct (Data storage in India): This is the core requirement of the directive. It mandates that the entire payment system data be stored in systems located only in India. This aims to improve data security and regulatory oversight. Statement 2 is Incorrect (Public sector ownership): The directive doesn't specify ownership requirements for the data storage systems. Private companies can also store data as long as the systems are located within India. Statement 3 is Incorrect (Audit report submission): The directive des not have reporting requirements for system audits to the Comptroller and Auditor General of India (CAG) which typically audits government entities.

The National Payments Corporation of India (NPCI) The NPCI operates the National Financial Switch (NFS), which is the largest network connecting ATMs across various banks in India. This network facilitates inter-bank transactions and allows users to withdraw cash from ATMs even if they don't belong to the bank that owns the ATM.

The Merchant Discount Rate (MDR) is a fee levied on merchants by payment processors for accepting debit and credit card transactions. It's typically a percentage of the transaction value. So, when a customer uses a debit card at a store, the store pays a fee to the bank that processes the transaction. Hence, option C is the correct answer.

Statement 1 is correct: Bharat Interface for Money (BHIM) is a payment app that lets you make simple, easy, and quick transactions using Unified Payments Interface (UPI). You can make direct bank payments to anyone on UPI using their UPI ID or scanning their QR with the BHIM app. You can also request money through the app from a UPI ID. Statement 2 is not correct: From a consumer point of view, three levels of authentication are required in this app. 1. The device ID and mobile number,
2. The bank account which you are linking to this app, and
3. The UPI Pin which is needed to complete the transaction. There are three factors of authentication versus a normal net banking app or a chip-in debit card which will only have two factors of authentication.

Pair 1 is incorrect: The Belle II experiment is a particle physics experiment designed to study the properties of B mesons. It is not related to artificial intelligence. Pair 2 s correct: Blockchain technology is the underlying technology behind cryptocurrencies like Bitcoin. It is a distributed ledger technology that ensures secure and transparent transactions. Pair 3 is incorrect: CRISPR-Cas9 is a gene-editing technology used in the field of molecular biology to edit genes. It is not related to particle physics. Therefore, only pair 2 is correctly matched.