Functions of RBI

                                                    RBI FUNCTIONS

                               

               The preamble of the Reserve Bank of India describes it main functions as:

..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

Regulator of the Banking System

It is regulator and supervisor for indian banking system and indian financial system. ensures the fincial stability and public confidence in banking system. and issues licences for  new banks, regulating interest rate in s specific areas, sets capital requirments. its regulates banking system from the provisions of banking regulation act 1949. RBI regulates indian banks, foriegn banks, RRBs, Co-Operative banks, development financial institutuins, Local area banks and NBFCs.

Banker to Banks[edit]

RBI also works as banker to all the scheduled commercial banks. All the banks in India maintain accounts with RBI which help them in clearing & settling inter bank transactions and customer transactions smoothly & swiftly. Maintaining accounts with RBI help banks to maintain statutory reserve requirements. RBI also acts as lender of last resort for all the banks.and the most important role is that it provide loan section up to 6%.

Banker and Debt Manager to Government