The Liquidity Adjustment Facility (LAF) was introduced by the Reserve Bank of India (RBI) in the year 2000. It serves as a crucial monetary policy tool aimed at managing short-term liquidity needs and surplus funds of scheduled commercial banks. It essentially provides a two-way window for commercial banks to address their short-term liquidity needs. It … Read more
The Bank Rate is defined under Section 49 of the RBI Act of 1934 as the standard rate at which the Reserve Bank of India (RBI) is willing to buy or rediscount bills of exchange or other commercial papers eligible for purchase. It serves as an important tool for regulating long-term funds borrowing by commercial … Read more
The Statutory Liquidity Ratio (SLR) is a mandatory requirement imposed on banks by the Reserve Bank of India (RBI) to maintain a certain proportion of their net demand and time liabilities (NDTL) in the form of liquid assets. These liquid assets typically include cash, gold, and approved securities like government bonds. Purpose and Impact of … Read more
The reverse repo rate (RRR) is the opposite of the repo rate. It is the short-term borrowing rate at which commercial banks park their surplus funds with the Reserve Bank of India (RBI). The RBI uses this tool to manage liquidity in the banking system, particularly when there is excess money circulating. How the Reverse … Read more
The repo (repurchase) rate, also known as the benchmark interest rate, is the rate at which the Reserve Bank of India (RBI) lends money to commercial banks for a short term, typically a maximum of 90 days. The repo rate is a key monetary policy tool used by the RBI to control liquidity and inflation … Read more
The Reserve Bank of India (RBI) executes several critical functions that contribute to the country’s economic stability and growth. These functions include overseeing monetary policy, issuing currency, managing foreign exchange, and serving as the banker to both the government and scheduled commercial banks. The foundational purposes for which the RBI was established as India’s central … Read more
Bharatiya Reserve Bank Note Mudran Bharatiya Reserve Bank Note Mudran (BRBNM) was established by the Reserve Bank of India (RBI) on 3 February 1995. Its main purpose is to bridge the gap between the demand and supply of Indian rupee notes in the country. BRBNM plays a crucial role in maintaining the production and distribution … Read more
The Reserve Bank of India (RBI) has established four regional representations in different parts of the country. These representations are located in New Delhi (North), Chennai (South), Kolkata (East), and Mumbai (West). Each representation is comprised of five members who are appointed by the central government for a term of four years. These members, with … Read more
The central board of directors is the primary governing body of the Reserve Bank of India (RBI). Directors are appointed by the Government of India for a four-year term. The board comprises: Composition and Roles
The Reserve Bank of India (RBI) was established in 1934 under the Reserve Bank of India Act. Initially privately owned, it was nationalized in 1949 and has since been fully owned by the Ministry of Finance, Government of India (GoI). Post-Independence Developments (1950–1960) Banking Reforms and Expansion (1961–1968) Nationalization and Regulation (1969–1984) Economic Reforms (1985–1990) … Read more