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Which feature clearly distinguishes a loan from an advance?

medium Q7 of 15
Banking Awareness - Basics Of Banking & Banking Terminology
Which feature clearly distinguishes a loan from an advance?
AHigher interest rate
BNo documentation
CFixed repayment schedule
DRepayable on demand
Step-by-Step Solution

  1. Step 1: Identify distinguishing feature

    The question asks what separates loans from advances.

  2. Step 2: Apply banking norms

    Loans have a fixed repayment schedule.

  3. Final Answer:

    Fixed repayment schedule → Option C

  4. Quick Check:

    Instalment-based repayment is unique to loans ✅
Quick Trick: Fixed schedule = Loan.
Common Mistakes:
  • Focusing only on interest rates.
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