Sage-Tips

Does RBI come under govt?

The Reserve Bank of India (RBI) is India’s central bank and regulatory body under the jurisdiction of Ministry of Finance, Government of India. It is responsible for the issue and supply of the Indian rupee and the regulation of the Indian banking system.

What type of body is RBI?

The Reserve Bank of India (RBI) is the central bank of India whose primary function is to manage and govern the financial system of the country. It is a statutory body established in the year 1935 under the Reserve Bank of India Act, 1934.

Is RBI constitutional body?

Though considered a body with considerable institutional independence, the RBI is not a constitutional body. It was established under the Reserve Bank of India Act, 1934. However, to reiterate, the independence of the RBI is not constitutional. At the most, it is only statutory, a major difference in law.

Why RBI is called government bank?

The RBI acts as banker to the government the Central as well as state governments. As such, it transacts all banking business of the government, which involves the receipt and payment of money on behalf of the government and carrying out of its exchange, remittance and other banking operations.

Why Sikkim is not under RBI?

It was made a part of India following a referendum in the year 1973. Thus, this state enjoys a special status under article 371F. Following which, Banking Regulation Act 1949 and Companies Act does not extend to Sikkim. This, the RBI had limited agreement to manage the public debt of the bank.

Is RBI a statutory corporation?

False: RBI is an example of a statutory corporation.

Is RBI a commercial bank?

The RBI was originally set up as a private entity in 1935, but it was nationalized in 1949. The main purpose of the RBI is to conduct consolidated supervision of the financial sector in India, which is made up of commercial banks, financial institutions, and non-banking finance firms.

How Upsc earn RBI?

RBI earns regular income by deploying the reserves in interest-bearing foreign currency, government securities (essentially promissory notes bearing an interest rate against which the government borrows) and gold. This gold along with its forex reserves make up almost 77\% of its assets.

Does RBI lend money?

Short-Term Borrowing – RBI lends money for a short period of time, maximum being an overnight post which the banks buy back their securities deposited at a predetermined price. Collaterals & Securities – RBI accepts collateral in the form of gold, bonds etc.