RBI And It’s
Functions
By Atharva Patil
INDEX
⮚ Introduction.
⮚ History.
⮚ Organization.
⮚ Regional offices and
Subsidiaries.
⮚ Functions.
⮚ Regulation of banking system.
⮚ Role of RBI in inflation control.
⮚ Export Credit
⮚ Restrictions And Guidelines of
INTRODUCTION TO
RBI
❖ Established in April 1935
under the RESERVE BANK
OF INDIAN ACT 1934.
❖ Head Quarters –
MUMBAI
❖ The Reserve Bank of India is
the central banking institution of
India and controls the monetary
policy of the rupee as well as
currency reserves.
❖ Present Governor –
P Raghuram rajan.
History Of RBI
⮚It was set up on the recommendations of
Hilton Young Commission
⮚It was started as share-holders bank with a
paid up capital of 5 crores
⮚ Initially it was located in Kolkata
⮚ It moved to Mumbai in 1937
⮚ Initially it was privately owned
⮚Since 1949, the RBI is fully owned by the
Government of India.
⮚ Its First governor was Sir Osborne A.Smith
⮚The First Indian Governor was “Sir
Chintaman D.Deshmukh
YEAR IMPORTANCE
1926 The Royal Commission on Indian Currency and Finance
recommended creation of a central bank for India.
1934 The Bill was passed and received the Governor General’s assent
1935 The Reserve Bank commenced operations as India’s central bank
on April 1 as a private shareholders’ bank with a paid up capital of
rupees five crore
1942 The Reserve Bank ceased to be the currency issuing authority
of Burma (now Myanmar).
1947 The Reserve Bank stopped acting as banker to the Government of
Burma
1948 The Reserve Bank stopped rendering central banking services to
Pakistan
1949 The Government of India nationalised the Reserve Bank under the
Reserve Bank (Transfer of Public Ownership) Act, 1948
Post Hierarchy In RBI
REGIONAL OFFICE AND SUBSIDARIES
• Has 27 regional offices.
• Has five training establishments
• College of Agricultural Banking and Reserve
Bank of India Staff College – Pune.
• National Institute for Bank Management- Pune.
• Indira Gandhi Institute for Development and
Research -
Mumbai.
• Institute for Development and Research in
Banking Technology (IDRBT)- Hyderabad.
SUBSIDIARIES
• Deposit Insurance and Credit Guarantee
Corporation of India(DICGC).
• Bharatiya Reserve Bank Note Mudran
Regional
offices of RBI
ROLE OF RBI IN INFLATION
CONTROL
• Inflation arises when the demand increases and
there is a shortage of supply There are two
policies in the hands of the RBI.
• Monetary Policy: It includes the interest rates.
When the bank increases the interest rates than
there is reduction in the borrowers and people try
to save more as the rate of interest has
increased.
• Fiscal Policy: It is related to direct taxes and
government spending. When direct taxes
increased and government spending increased
than the disposable Income of the people
reduces and hence the demand reduces.
Export Credit
• Recognising the important
role of exports in
maintaining the viability of
external sector and in
generating employment,
the Reserve Bank had
sought to ensure adequate
availability of concessional
bank credit to exporters.
• It took the lead role in
setting up the Export
Import Bank of India (EXIM
Restrictions and Guidelines of RBI
Bank Rate : It’s the interest rate that is charged by
a country’s central bank on loans and advances
to control money supply in the economy and the
banking sector.
The present bank rate is 8.75%
Repo Rate: Whenever the banks have any
shortage of funds they can borrow it from the
central bank. Repo rate is the rate at which our
banks borrow currency from the central bank.A
FUNCTIONS OF RBI
• Financial supervision.
• Monetary management.
• Issue of currency.
• Banker to government.
• Banker to bank.
• Formulate monetary policy.
• Financial regulation and
management.
• Manager of foreign exchange.
• Development role.
THANK
YOU
