क्रे डि ट

सा औ र
पै

M
STE
R SY
RTE
BA
ALL THESE LEAD TO THE DEVELOPMENT OF BARTER
● DIVISIBLE INTO SMALLER PARTS
 MONEY
● ANYTHING USED A MEDIUM OF EXCHANGE
● STORE OF VALUE
● MEASURE OF VALUE
● TRANSFER OF VALUE
● STANDARD OF DEFERRED PAYMENT - allowing
goods and services to be acquired now and paid for in the future. ...
The Reserve Bank of India supervises the banks. Supervision is
practiced in the following ways:
(i) The RBI monitors that banks actually maintain a certain percentage of their
deposits as cash balance.

(ii) The RBI supervises the functioning of formal sources of loans and also sees
that banks give loans not 'just to make profits by giving them to traders and
businessmen but also to fanners, small cultivators and small-scale industries.

(iii) The rate of interest for formal lenders is decided by the RBI, so, normally the
interest rates are very low.

(iv) It is the RBI that issues the Cash Reserve Ratio and Statutory Liquidation
Rate to commercial banks so as to maintain minimum cash reserves out of their
deposits.
(iv) It is the RBI that issues the Cash Reserve Ratio and Statutory
Liquidation Rate to commercial banks so as to maintain minimum cash
reserves out of their deposits.

(v) Periodic reports have to be submitted by all other banks to the RBI which
should contain details such as how much they have lent, to whom, at what
rate of interest, etc.

(vi) The RBI is the lender of last resort. Whenever banks are short of funds,
they can take loans from the RBI. Thus, it is a source of great strength to the
banking system.

(vii) The RBI also acts as a bank of central clearances, settlements and
transfers.
 CREDIT
A PROMISE TO PAY IN FUTURE

A B

CASH , GOODS , SERVICES