Investor Interface with the R&T Agent
10 questions. Each answer is explained.
Question 1 of 10Practice · Series II-A — Registrars to an Issue and Share Transfer Agents - Corporate
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Learn these topics
More units in NISM Series II-A
- Introduction to Securities10
- Characteristics of Equity Shares10
- Characteristics of Debt Securities10
- Characteristics of Other Securities10
- Basics of Mutual Funds10
- SEBI – Role and Regulations10
- Public Offer of Securities10
- Modes of allotment of shares other than Public Offers10
- Processes related to Public Offering of Shares10
- Roles and Responsibilities in a Public Issue10
- Depository Services10
- Processes Related to Depositories10
- Secondary Market Transactions10
- Client Servicing10
Exam format
| Questions | 100 · 1 mark each |
|---|---|
| Duration | 120 min · 2 hours |
| Pass mark | 50% · 50 of 100 marks |
| Negative marking | None · a wrong answer costs nothing beyond the mark |
| Certificate validity | 3 years · from the date of the examination |
| Marks for this unit | 10 of 100 marks (10%) |
Source: March 2025 Annexure I, Unit 13: Investor interface with the R&T Agent
NISM Series II-A Registrars to an Issue and Share Transfer Agents - Corporate
Exam rules read on NISM's site on 31 October 2026. Check the current rules on NISM's site (opens in a new tab)
What these answers assume, and when it was last checked
Each question uses the rules listed below. We last checked them on 5 September 2026. A Budget or SEBI circular can change a rate, lot size or expiry day. If a rule changes before your exam, treat the linked questions as out of date and check NISM's current workbook.
- NSE uses Tuesday expiry and BSE uses Thursday expiry. This applies from 1 September 2025.
- The January 2026 index lot sizes are NIFTY 65, BANKNIFTY 30, FINNIFTY 60, MIDCPNIFTY 120 and NIFTYNXT50 25.
- The October 2024 SEBI framework sets a minimum index contract value of Rs 15–20 lakh. Each exchange may list one weekly benchmark index.
- Option buyers pay the premium upfront from 1 February 2025. A short index option has an extra 2% Extreme Loss Margin on expiry day from 20 November 2024.
- Equity short-term capital gains are taxed at 20%. Long-term gains are taxed at 12.5% above Rs 1.25 lakh. Both rates apply from 23 July 2024.
- F&O income is non-speculative business income in ITR-3. NSE equity derivatives trade from 9:15 a.m. to 3:40 p.m.
- The final ten-minute session began on 3 August 2026. It aligns with the cash market Closing Auction Session.
- Most Securities Transaction Tax questions test the base and who pays. On an option sale, it is the premium and the seller pays. On a futures sale, it is the traded value and the seller pays.
- On exercise, Securities Transaction Tax uses intrinsic value: settlement price minus strike price. The buyer pays it.
- Two questions test the current rate. From 1 April 2026, option sales carry 0.15% on the premium and futures sales carry 0.05% on traded price. The earlier rates were 0.10% and 0.02% from 1 October 2024.
- This section uses the T+1 rolling settlement cycle. Obligations are fixed on T+1. A short delivery goes to buy-in auction on T+1 and settles on T+2.
- The trade-for-trade surveillance segment uses direct close-out. Funds pay in by 10:30 a.m. and pay out on or after 1:30 p.m. on settlement day.
- Securities pay in to the settlement pool by 10:30 a.m. They pay out directly to the client’s demat account by 3:30 p.m.
- The 3:30 p.m. deadline replaced 1:30 p.m. under SEBI’s 10 October 2024 circular. Direct client credit was required by SEBI’s 5 June 2024 circular.
- The optional T+0 cycle trades until 1:30 p.m. Obligations are fixed by 2:30 p.m. on the trade day. An early pay-in shortage is closed out directly.
- Cash-market Value at Risk margin is six times exponentially weighted moving-average volatility. It has a 9% floor for Group I, a 21.5% floor for Group II, and a fixed 50% or 75% level for Group III.
- Extreme Loss Margin is 3.5% for a share and 2% for a broad-market-index exchange traded fund. Mark-to-market margin is collected before the next day’s trading. The trade-for-trade segment has 100% upfront margin.
- Close-out uses the higher of the highest price from trade day to auction day and 20% above the auction day’s official close.
- A funds shortage costs 0.07% a day. The trading facility is withdrawn at a shortage of Rs 5 lakh or more.
- SCORES allows 21 calendar days, then two 15-day review levels. Online Dispute Resolution moves from conciliation to arbitration after the market participant and SCORES steps.
- At NSE, the Investor Protection Fund limit is Rs 35 lakh per investor for each defaulting or expelled member. This applies to claims arising after 13 August 2024.
- A Basic Services Demat Account has no annual maintenance charge up to Rs 4 lakh of holdings. It costs up to Rs 100 above that, until the Rs 10 lakh eligibility ceiling. These slabs apply from 1 September 2024.
- The rupee pairs are USD-INR, EUR-INR, GBP-INR and JPY-INR. The cross-currency pairs are EUR-USD, GBP-USD and USD-JPY.
- Each contract covers 1,000 units of the foreign currency, except JPY-INR. JPY-INR covers 100,000 yen and is quoted in rupees per 100 yen.
- The tick is 0.25 paise, or Rs 0.0025. It equals Rs 2.50 a contract.
- Rupee pairs trade from 9:00 a.m. to 5:00 p.m. A monthly contract stops trading at 12:30 p.m. two working days before the expiry month’s last business day.
- Final settlement is in cash at the FBIL reference rate on expiry day. FBIL, Financial Benchmarks India, has published this rate in place of the Reserve Bank since 2018. Premium-style European options are quoted in rupees. The buyer pays the premium in cash on T+1.
- Daily settlement is on T+1 and final settlement is on T+2.
- NSE Clearing circular 026/2020 sets SPAN margin plus Extreme Loss Margin. The futures margin is 0.50% for USD-INR, 0.15% for EUR-INR, 0.25% for GBP-INR and 0.35% for JPY-INR. A short option has 0.75%. These figures apply from 1 June 2020.
- A USD-INR client may hold 6% of total open interest or USD 20 million, whichever is higher. A trading member may hold 15% or USD 100 million.
- A resident user has one USD 100 million equivalent limit across all rupee pairs and exchanges. No document is needed below that limit, but a valid underlying contracted exposure must still exist. This clarification applies from 3 May 2024.
- The currency segment has no Securities Transaction Tax.
The exam figures (questions, time, pass mark, negative marking and certificate validity) come from NISM's own pages, read on 31 October 2026. Timed practice uses the same figures. Study with the official workbook as well.
The written-out answers on this page are hidden while your timed set runs.
All 10 questions on Investor Interface with the R&T Agent, with answers
Q1Which term describes a change in securities ownership arising from a holder’s death through the applicable legal process?
Option A. Transmission — Correct answer
Option B. A stock split
Why it is wrong: A split changes share quantity and face value, not ownership because of death.
Option C. A routine exchange sale
Why it is wrong: A routine exchange sale requires a trading transaction and is not the process described.
Option D. A rights subscription
Why it is wrong: A rights subscription concerns acquiring newly offered shares.
Answer: A. Transmission is the change arising through the applicable legal process after a holder’s death, rather than a voluntary market sale. Remember: Transmission and voluntary transfer are distinct processes.
Hint, shown before you answer in practice mode: The change occurs by operation of law rather than through the holder’s sale instruction. Common mistake: Using ordinary sale or transfer paperwork without considering transmission requirements.
II-A-121easyconceptual
Q2What is transposition of names in a jointly held securities record?
Option A. Cancelling the holding and refunding its face value
Why it is wrong: Transposition does not cancel or redeem the investment.
Option B. Increasing the shares held by every joint holder
Why it is wrong: Changing name order does not increase the securities quantity.
Option C. Changing the order of the same joint holders’ names — Correct answer
Option D. Replacing one joint holder with a new investor
Why it is wrong: Replacing a holder changes the holder set rather than merely its order.
Answer: C. Transposition changes the order of the same joint holders’ names without itself adding or removing a holder. Remember: Transposition changes order, not the set of joint holders.
Hint, shown before you answer in practice mode: The people remain the same even though their sequence changes. Common mistake: Treating removal of a joint holder as a simple name-order change.
II-A-122easyconceptual
Q3What is the protective purpose of a stop-transfer request concerning reported lost physical share certificates?
Option A. To help prevent an unauthorised transfer while the matter is examined — Correct answer
Option B. To cancel every share issued by the company to all its holders
Why it is wrong: It does not cancel the company’s entire capital.
Option C. To guarantee that the share’s exchange price cannot fall meanwhile
Why it is wrong: A stop-transfer instruction does not control the market price.
Option D. To convert the holder’s shares into a company deposit for safety
Why it is wrong: It does not change an equity holding into a deposit.
Answer: A. A stop-transfer request helps prevent an unauthorised transfer of the affected holding while the loss and supporting documents are examined. Remember: A stop-transfer request protects the affected holding rather than its market value.
Hint, shown before you answer in practice mode: The concern is misuse of the missing ownership documents. Common mistake: Assuming a protective record instruction is a price-protection mechanism.
II-A-123easyconceptual
Q4An email asks an RTA to replace an investor’s registered bank details. The sender’s authority is unverified. What is the appropriate first response?
Option A. Delete the previous bank record so no conflict remains
Why it is wrong: Deleting the previous record removes an important audit trail and does not prove the new instruction.
Option B. Follow the required identity and authority checks before changing records — Correct answer
Option C. Change the bank details because the email quotes a share quantity
Why it is wrong: Knowing a share quantity does not prove authority to redirect payments.
Option D. Make the change and ask for proof only after a dividend fails
Why it is wrong: Verification after a failed payout exposes the investor to avoidable risk.
Answer: B. The RTA should verify identity and authority through its prescribed process before changing payout details. Remember: Bank-detail changes require verified instructions, not just plausible account information.
Hint, shown before you answer in practice mode: A request affecting where money is paid deserves controlled verification. Common mistake: Accepting knowledge of a holding as sufficient authority to redirect money.
II-A-124mediumapplication
Q5An investor grants a representative a limited power of attorney for specified service requests. How should the RTA assess an instruction from that representative?
Option A. Check that the instruction falls within the valid authority granted — Correct answer
Option B. Treat it as unrestricted authority over every investment
Why it is wrong: A limited authority does not automatically cover every possible transaction.
Option C. Treat the representative as the new beneficial owner
Why it is wrong: A power of attorney does not itself make the representative the beneficial owner.
Option D. Ignore the document because only verbal instructions can ever count
Why it is wrong: Written legal authority cannot be replaced by a rule that only verbal instructions count.
Answer: A. The RTA should check that the instruction falls within the valid authority granted by the power of attorney. Remember: Check the scope and validity of representative authority before acting.
Hint, shown before you answer in practice mode: A representative’s authority has a scope and does not automatically transfer ownership. Common mistake: Treating every power of attorney as unlimited authority.
II-A-125mediumapplication
Q6What is a practical benefit of electronic voting for an eligible shareholder at a company meeting?
Option A. The shareholder receives additional shares for every vote
Why it is wrong: Voting does not itself create an entitlement to additional shares.
Option B. Voting can be submitted through the authorised electronic process — Correct answer
Option C. The shareholder can vote without owning an eligible interest
Why it is wrong: Electronic access does not remove eligibility requirements.
Option D. The shareholder can change other investors’ voting choices
Why it is wrong: One shareholder cannot use the facility to change others’ authorised votes.
Answer: B. Electronic voting lets an eligible shareholder submit a vote through the authorised electronic process rather than relying only on physical attendance. Remember: Electronic voting supports exercise of existing eligible voting rights.
Hint, shown before you answer in practice mode: Technology changes how eligible voting rights are exercised, not who owns those rights. Common mistake: Assuming an electronic channel creates voting rights that the investor did not already have.
II-A-126mediumconceptual
Q7Why must replacement processing for a lost securities certificate prevent the old and replacement evidence from supporting duplicate claims?
Option A. Both relate to the same underlying holding — Correct answer
Option B. Replacement creates a separate fresh issue of shares
Why it is wrong: Replacement does not by itself constitute a fresh issue.
Option C. The issuer’s capital doubles when a certificate is replaced
Why it is wrong: Replacing evidence of ownership does not double issued capital.
Option D. The registrar becomes owner of the original holding
Why it is wrong: The registrar does not acquire the investor’s original holding through the replacement process.
Answer: A. Both relate to the same underlying holding, so controls must prevent the old and replacement evidence from creating duplicate entitlement claims. Remember: Replacement servicing must preserve one valid entitlement for the original holding.
Hint, shown before you answer in practice mode: Replacement evidence restores access to an existing holding rather than creating a second investment. Common mistake: Treating a replacement document or credit as a second separate shareholding.
II-A-127mediumconceptual
Q8A statement shows ₹6,000 gross dividend and ₹600 tax withheld. The bank received ₹5,400. What unreconciled cash difference exists in these figures?
Option A. ₹5,400
Why it is wrong: ₹5,400 is the net dividend paid, not the difference.
Option B. ₹0 — Correct answer
Option C. ₹6,600
Why it is wrong: ₹6,600 incorrectly adds withholding to the gross dividend.
Option D. ₹600
Why it is wrong: ₹600 is the stated withholding, not an unexplained cash shortfall.
Answer: B. The unreconciled difference is ₹0. Expected net credit = ₹6,000 − ₹600 = ₹5,400. Actual credit is also ₹5,400. Remember: Reconcile gross dividend, stated withholding and actual net credit separately.
Hint, shown before you answer in practice mode: Compare the actual bank credit with the net amount shown by the statement. Common mistake: Calling every difference between gross dividend and bank credit a missing payment.
II-A-128mediumnumerical
Q9Shares of a deceased holder have moved to the Investor Education and Protection Fund account. A family member requests payment using only an old certificate copy. What must be established?
Option A. Only that the claimant is the first person to telephone the company
Why it is wrong: Calling first does not determine who is entitled to a deceased holder’s assets.
Option B. The claimant’s entitlement and the required transmission and claim documents — Correct answer
Option C. Only that the current market price exceeds the old face value of shares
Why it is wrong: Market price does not prove the claimant’s authority.
Option D. Only that the claimant can quote the old certificate number from memory
Why it is wrong: Knowing a certificate number does not by itself establish legal entitlement.
Answer: B. The claimant’s entitlement and required transmission and claim documents must be established because an old certificate copy alone does not prove authority to receive the assets. Remember: A claim involving a deceased holder and the fund requires a supported chain of entitlement.
Hint, shown before you answer in practice mode: Both the original holding and the claimant’s authority must be connected through the proper process. Common mistake: Treating possession of an old certificate copy as complete proof of inheritance.
II-A-129hardapplication
Q10One holding is jointly in A and B’s names. Another is jointly in A and C’s names. A asks to combine them by deleting B and C. How should this be treated?
Option A. As a bonus issue because the final account will hold more shares
Why it is wrong: Combining records does not create free bonus shares.
Option B. As an automatic merger because both holdings contain the same security
Why it is wrong: Holding the same security does not remove joint holders’ interests.
Option C. As an ownership change requiring appropriate authority, not simple consolidation — Correct answer
Option D. As a routine name-order change because A is common to both
Why it is wrong: Deleting B and C is not just changing the order of existing names.
Answer: C. The request changes the holder set and therefore needs appropriate authority and processing rather than being treated as simple consolidation or transposition. Remember: Confirm the full holder set before treating holdings as identical for service processing.
Hint, shown before you answer in practice mode: A common first holder does not make two different joint-holder groups identical. Common mistake: Looking only at the first holder when comparing joint holdings.
II-A-130hardapplication
Investor Interface with the R&T Agent: common questions
How many practice questions are there on Investor Interface with the R&T Agent?
10 questions, all written out on this page with the correct answer and why each other option is wrong. This unit is one of the 15 practice topics for NISM Series II-A, which has 150 questions in total.
Are these real NISM Series II-A questions on Investor Interface with the R&T Agent?
No. LearnNifty wrote every question from NISM's public syllabus. NISM does not publish its question bank, so nobody can offer you the real paper. Use these questions to check that an idea has gone in. Use the official NISM workbook to see what is examined.
How much of the NISM Series II-A exam is Investor Interface with the R&T Agent?
NISM's published syllabus outline gives it 10 of the paper's 100 marks, or 10% of the exam. It is quoted from the outline, not estimated. The published unit it comes from: March 2025 Annexure I, Unit 13: Investor interface with the R&T Agent
Does negative marking apply to NISM Series II-A?
No. NISM applies no negative marking to Series II-A. A wrong answer costs nothing beyond the mark you did not earn, so a blank is never better than an attempt. Timed practice here uses the same rule.
Are these practice questions kept up to date?
Each question is written against the rules printed on this page, last checked on 5 September 2026. A Budget or a SEBI circular can change a rate, a lot size or an expiry day. If one of those rules changes before your exam, treat the questions that use it as out of date. Then check NISM's current workbook.
Secondary Market Transactions
10 questions on Secondary Market Transactions. Its quiz opens on that unit.
Open Secondary Market TransactionsPaper Trading Try it on the practice trading desk