The Reserve Bank of India (RBI) serves as the central bank of India and performs several critical functions: it issues currency notes and coins, provides banking services to the government, requires commercial banks to maintain cash reserves, maintains foreign exchange reserves to deal with financial crises, acts as a lender of last resort for banks in need, and controls the credit created by commercial banks to align with government economic priorities. The RBI thus regulates financial transactions, supports the government's banking needs, and stabilizes the banking system in India.
The Reserve Bank of India (RBI) serves as the central bank of India and performs several critical functions: it issues currency notes and coins, provides banking services to the government, requires commercial banks to maintain cash reserves, maintains foreign exchange reserves to deal with financial crises, acts as a lender of last resort for banks in need, and controls the credit created by commercial banks to align with government economic priorities. The RBI thus regulates financial transactions, supports the government's banking needs, and stabilizes the banking system in India.
The Reserve Bank of India (RBI) serves as the central bank of India and performs several critical functions: it issues currency notes and coins, provides banking services to the government, requires commercial banks to maintain cash reserves, maintains foreign exchange reserves to deal with financial crises, acts as a lender of last resort for banks in need, and controls the credit created by commercial banks to align with government economic priorities. The RBI thus regulates financial transactions, supports the government's banking needs, and stabilizes the banking system in India.
• Being a central bank of India, RBI serves a critical role in regulating the financial trans • The Issuer of Bank Notes • The most important function of RBI is the issuance of currency notes and coins actions in the country. • Banker to the Government • Another chief function of RBI is that it takes care of the banking needs of the government, which includes maintaining & operating the deposit accounts of the government, collecting the receipts of funds, and making payments on behalf of the Government of India. • Custodian of Cash Reserves of Commercial Banks • Commercial banks are required to maintain the cash reserves at a rate decided by the RBI in its monetary policy. • Custodian of Foreign Exchange Reserve • Another of the important functions of RBI is maintaining a reserve of foreign currencies that enables the RBI to deal with any crisis situation. • Lender of the Last Resort • it becomes the lender of the last resort for all banks when they are in a crisis situation. RBI helps them by lending money • Controller of Credit • RBI controls the credit created by the commercial banks in India, in accordance with the economic priorities of the government of India. RBI uses quantitative and qualitative methods to control and regulate the flow of money in the market. THANK YOU