How much amount of the debenture must be transferred to the debenture redemption reserve before redemption begins by a banking company?

Zero

The correct answer is option 1- Zero.

All India financial institutions registered by Reserve Bank of India, banking companies, NFBCs registered with Reserve bank of India, Housing Finance companies registered to the National Housing bank and the companies listed on stock exchange and unlisted companies are exempted from creating Debenture Redemption Reserve and may redeem debentures out of capital. Whereas for "other unlisted companies", the adequacy of Debenture Redemption Reserve shall be ten percent of the value of the outstanding debentures.