History of Banking in India 2/4

Reserve bank of India:

RBI head office is in Bombay.

1. The RBI is the apex of bank or central bank of the country. Central banks have different names in different countries. It is Reserve bank of India in India, The bank of England in England, The Federal Reserve System in America, and The Bank of France in France etc.
2. The general administration and direction of the RBI is managed by a central board of directors consisting of 20 members who include the Governor, 4 Deputy Governors, 1 Government official appointed by Union government of India.

 Functions of RBI:

1. It is also called Central Bank of India or Bankers Bank.
2. Lender of last resort.
3. Issue of coins.
4. Issue of Notes: Issues currency notes of various denominations except one-rupee notes. The one-rupee note is issued by Ministry of Finance.
5. Banker to the Government: It acts as the Banker, Agent and Adviser to the Government.
6. Bankers Bank.
7. Collects Stastical data of Indian Economy (Means collecting information regarding GDP, Agricultural growth rate, Industrial growth rate, services, Inflation, Food inflation, Exports, Imports, Forex).
8. Controller of Credit: Utilizes the repo and reverse repo rates.
9. Custodian of Foreign Reserves (These foreign deposits will be either in I) Money is directly Foreign Currency         II) Gold           III) SDR ( Special Drawing Rate) and IMF ( International Monetary Fund).
10. Regulator of Banks (Means regulating ATMs, Branches of Banks etc).

Reference: Book “Money Banking Finance” by “KPM SUNDARAM”

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