RBI Full Form

Because of the operations, roles, and responsibilities undertaken by RBI, also called the central bank of India is referred to as the bank of banks. The Reserve Bank of India Act, 1934, was the basis to establish the Reserve Bank of India on April 1, 1935. The RBI’s headquarters were initially located in Calcutta. However, it was soon after, in 1937, that it was permanently relocated to Mumbai. 

Mr. Shaktikanta Das will be the Governor of the Reserve Bank of India starting October 20, 2021. He is the 25th RBI Governor, and he is in charge of all RBI duties. 

Functions Of Reserve Bank Of India

As India’s central bank, the RBI plays an important role in controlling financial activities in the country. The following are some of the RBI’s most important functions: 

Bank Notes Printing

Except for the one rupee note and coin provided by the Ministry of Finance, the RBI’s most essential job is the issuing of currency notes and coins. The RBI Governor’s signature appears on all other notes. The Reserve Bank of India, on the other hand, is the organization in charge of distributing both notes and coins backed by the Government of India. 

Government-Owned Banker

Another major responsibility of the RBI is to manage the government’s banking needs. This includes managing and administering the government’s bank deposits, collecting funds, and transferring money with respect to the Government of India. As a  participant of the International Monetary Fund and the World Bank, the Reserve Bank of India also represents the Indian government. 

Custodian Of Commercial Banks’ Cash Reserves

Commercial banks are expected to have cash reserves at a rate determined by the RBI’s monetary stimulus. 

Custodian Of The Country’s Foreign Exchange Reserves

Another key responsibility of the RBI is the administration of a foreign currency reserve, which allows the RBI to respond to any major incident. 

Last-Resort Lender

The RBI, sometimes referred to as the “banker of banks,” serves as a parent institution for all Indian commercial banks. As a result, in times of crisis, it will become the lender of last resort for any and all banks. The RBI assists businesses by extending credit, although at a higher rate of return, to assist them sail over the storm of financial pressures.

Credit Controller

In compliance with the government of India’s economic aims, the RBI oversees the credit produced by commercial banks in India. To monitor and govern the circulation of money in the economy, the RBI employs both quantitative and qualitative methods. These are carried out through declaring monetary and fiscal policy on a regular basis. Monetary policy is concerned with the control of interest rates and money creation. The Indian central bank manipulates the money supply to meet goals such as availability, hyperinflation, and expenditure. 

Conclusion 

We discussed the Reserve Bank of India & the Functions of the Reserve Bank of India and other related topics through the study material notes on RB1 Full Form. We also discussed how RBI acts as a Last-resort lender to banking institutions for better clarity. 

The RBI, sometimes referred to as the “banker of banks,” serves as a parent organization for all commercial banks in India. As a result, in an emergency, it will serve as the banker to lend in times as a last resort for all institutions. The RBI assists businesses by extending credit, perhaps at a higher expected return, to help them overcome the financial storm.