Financial Awareness - Risk, Stability & Emerging Finance
Which of the following loans is generally unsecured and can be recalled by the bank at any time without prior notice?
Which of the following loans is generally unsecured and can be recalled by the bank at any time without prior notice?
medium Q6 of 15
Step-by-Step Solution
Step 1: Understand loan security and recall features
Demand Loan is usually unsecured and repayable on demand, meaning the bank can recall it anytime.Step 2: Compare with other loans
Term Loan is secured and has fixed tenure, Cash Credit is secured working capital loan, Bill Discounting involves purchase of bills.Final Answer:
Demand Loan → Option DQuick Check:
Demand Loan = unsecured, repayable on demand, recallable anytime ✅
Quick Trick: Demand Loan = unsecured and repayable anytime.
Common Mistakes:
- Confusing Demand Loan with Term Loan due to repayment terms.
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