It supervises the functioning of formal sources of loans. What is the role of RBI in Indian Economy Class 10? Using this policy RBI manages the interest rates offered by banks on loans and deposits and which affects the inflation and deflation in the country. This policy is the most important tool that the RBI has. RBI formulates, implements and monitors the monetary policy. What is meant by RBI role in the economic development? RBI regulates the total volume of credit that may be extended to customers by the commercial banks and fixes a minimum time period for repayment or increases down payment required for specific categories to influence the flow of credit in a particular direction. What is the role of RBI in control of credit? The Reserve Bank‟s developmental role includes ensuring credit to productive sectors of the economy, creating institutions to build financial infrastructure, and expanding access to affordable financial services. What is the role of RBI in economic development? It promotes financial inclusion by ensuring that banks give loans not just to profit-making businesses and traders but also to small cultivators, small scale industries, and small borrowers. It acts as the banker and financial advisor to government. The RBI is responsible for regulating currency, securing monetary stability, maintaining currency reserves, and overseeing India’s credit and currency system. It began operations in 1935-a year after the establishment of the Reserve Bank of India Act of 1934. The Reserve Bank is India’s central bank.

What is the role of RBI in Indian economy? See our User Agreement and Privacy Policy. If you continue browsing the site, you agree to the use of cookies on this website. SlideShare uses cookies to improve functionality and performance, and to provide you with relevant advertising. What are the functions of RBI SlideShare?įunctions of RBI. Key functions of RBI are, banker’s bank, the custodian of foreign reserve, controller of credit and to manage printing and supply of currency notes in the country. RBI was established on 1 April 1935 by the RBI Act 1934. Reserve Bank of India (RBI) is the Central Bank of India.

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