DEPARTMENT OF TECHNICAL EDUCATION

ANDHRA PRADESH
Name : Md. Qadeer Rehman
Designation : HEAD OF SECTION
Branch : D.C.C.P.
Institute : K D R Govt, Polytechnic,
Wanaparthy.
Year : I year
Subject : Business Organization
Subject code : CCP-104
Topic : Banking
Duration : 50 mts
Sub topic : Reserve Bank of India
Teaching Aids : Diagrams
CCP104.149 TO 150 1
Objectives

On completion of this you would be

able to:
 Explain the fundamental principles of RBI
 Explain the organization of RBI
 Describe the functions of RBI
 Explain the role of RBI as Banker for
Banks

CCP104.149 TO 150 2
Recap:

 The banks and banking system

 The various types of banks
 The commercial banks
 The functions of various banks

CCP104.149 TO 150 3
Reserve Bank of India (RBI)

 It is the apex Bank in India

 It acts as Central Bank for India
 It gives license to all the commercial banks
and renews the license to perform banking
business
 It is a banker for banks
 The RBI acts as direction giving body,
controlling, assisting and regulating body for
all Indian banks
CCP104.149 TO 150 4
Organization of RBI

The RBI affairs are managed by Central

Board of Directors which does not exceed
20members

 Called as chief executive authority

 The Central Govt appoints 04 Dy. Directors

CCP104.149 TO 150 5
Organization of RBI

 Four directors are to be nominated by the

Central Government for each of four local
boards
 Ten Directors are to be nominated by
Central Government
 One Government official nominated by
Central Government

CCP104.149 TO 150 6
 Functions of
RBI
The RBI acts
as the central
bank, the
promotional
bank and All the above
helps the functions are
economy of three
types

Development
Central al and General
banks promotional functions
functions functions
CCP104.149 TO 150 7
Central Banking Functions of RBI:

 Note printing, issuing, all kinds of currencyt notes

 It acts as banker to Governments
 It is a banker for all banks. Its help at any time of
need
 It controls the credit supply in the country
 It promotes the foreign exchange reserves
 It regulates and maintains economic development
through the control of export and import trade

CCP104.149 TO 150 8
General banking functions of RBI

 Accepts deposits without interest from

banks and governments
 Manages public debt, issue of bonds from
government to the public
 Acts as financial adviser to government

CCP104.149 TO 150 9
General banking functions
of RBI
 Acts as financial adviser to Government
 It represents to world bodies IBRD (world
bank), IMF on behalf of India
 It discounts, rediscounts the bills of all
banks
 Advances and loans to governments for 90
days
 Acts as a clearing house for India

CCP104.149 TO 150 10
Developmental and
Promotional Functions of RBI

 It encourages all the banks in the mobilization of

resources
 It organizes the IFCI, SFI on behalf of government
 It set up the Deposit Insurance and the Credit
Corporation of India
 4. It has established the UNIT TRUST OF INDIA

CCP104.149 TO 150 11
Developmental and Promotional
Functions of RBI

 It has started the Industrial Development Bank

of India
 It promoted the regional rural banks (RRBs)
 It has started Agricultural Re-finance
Corporation
 It is responsible for the creation of NABARD

CCP104.149 TO 150 12
Summary

we have discussed about

 The RBI and its organization

 The functions of RBI
 RBI as banker for banks
 RBI role for the development of
economy

CCP104.149 TO 150 13
Quiz

1. The RBI at times acts as:

d) The state bank of India

e) The Central Bank of India
f) The State of bank Hyderabad
g) The Allahabad Bank

CCP104.149 TO 150 14
Quiz

2.The RBI advances, finances, controls and

advances to all other banks at times of
need, hence it is called:
a) A bank for all banks
b) The State Bank of India and the State of
Hyderabad
c) The Central Coop. Bank
d) The Canara Bank

CCP104.149 TO 150 15
Quiz

3. The foreign exchange reserves are protected

by the following bank:
a) The Reserve Bank of India
b) The Canara Bank
c) The EXIM Bank
d) The State Bank of Hyderabad

CCP104.149 TO 150 16
Frequently Asked Questions:

1. Explain in twelve sentences the organization

of RBI.
2. Explain in twelve sentences the functions of
RBI.
3. Explain in eight sentences the role of RBI as a
banker for banks.
4. Explain in eight sentences the foreign
exchange controls by RBI.

CCP104.149 TO 150 17