RESERVE BANK OF INDIA (RBI)
The Reserve Bank of India (RBI) is the central bank of India. It acts as an apex bank of the country which regulates the actions of the banks in the country and takes care of the money flow in the country.
The Preamble of RBI is “To regulate the issue of bank notes and keeping of reserves with a view to securing monetary stability in India and generally to operate the currency and credit system of the country to its advantage. To have a modern monetary policy framework to meet the challenge of an increasingly complex economy to maintain interest rate stability while keeping in mind the objective of growth”.
OBJECTIVES OF RESERVE BANK OF INDIA (RBI)
- To protect the savings of public.
- To control the supply of money and credit in order to achieve a nation’s broad economic goal.
- To Promote public confidence in the financial system.
- To ensure equal opportunity and fairness in the public access to credit and other financial services.
- To help sectors of the economy that they have special credit needs for example small business, housing and agricultural loans, etc.
- To avoid concentration of financial power in the hands of few individuals and institutions.
- Provide the government with credit, tax revenue, and other services.
FUNCTIONS OF RESERVE BANK OF INDIA (RBI)
The functions of the RBI are mainly classified into two types, they are as follows,
- Monetary Functions
- Non-Monetary Functions
01. Monetary Functions
The Monetary functions of the RBI deal with the issues related to money flow and money involvement, etc. The monetary functions of the RBI are as follows,
- Issue of Currency
- Banker to Banks
- Banker to Government
- manager of Foreign Exchange
- Control of Credit
02. Non-Monetary Functions
The Non-Monetary functions are mainly a regulatory and data analysis and education functions of the RBI, Some of them are as follows,
- Collection and Publication of data
- Development and Promotion
- Regulatory and Supervisory.