Reserve Bank of India - Facts you need to know

Published on Saturday, June 13, 2015
RBI is the central Bank of India.It established on 1st April 1935 under RBI Act 1934 with the recommendation of Hilton Young Commission .

RBI Governor : Raghu Ram Rajan ( 5th Sept,2013 - 4 Sept,2016)

Deputy Governors : 4
  1. H. R . Khan
  2. S S Mundra
  3. Dr. Urjit Patel
  4. R Gandhi

Facts about RBI

1. India’s central banking institution/authority
2. Controls Monetary policy of the Indian rupee
3. Est. 1 Apr,1935 during the British Raj under RBI ACT 1934
4. Nationalized in 1st Jan,1949
5. Member bank of the Asian Clearing Union
6. Providing license to New Banks
7. It regulate, control & inspects the bank in India
8. Share capital fully paid initially owned by private shareholders
9. It plays an important part in the development strategy of the govt. of India
10. Consist of 21 members
  • 1 Governor
  • 4 Deputy Governor
  • 2 Finance Ministry Representative
  • 10 Govt. nominated directors to represent important elements from India's economy
  • 4 Directors to represent local boards 

Public Sector Bank

Those Bank in which Govt. share is 51% or above that is called Public Sector Bank.

Example : SBI, Allahabad Bank, Bank Of Baroda, Bank of India

Private Sector Bank

In which private Individual or Group of Private individual's share is 51% or above.

Example : ICICI

Foreign Bank

Head office locate outside and Branches comes in India.

Example: FB, BOA , Catholic Bank

Types of foreign currency accounts

Public Sector Bank (PSB)

  • 1969 's 14 Bank nationalised
  • 1981 's again 6 Bank nationalised
  • 1993  2 merge bank New Bank of India & PNB
  •  19 + IDBI + SBI + 5 Associate Of SBI + Bhartiya Mahila Bank

Subsidiary of RBI 

  • Fully owned by Govt.
  • national Housing Bank (NHB)
  • Insurance Credit & Depository
  • (NBARD) National Bank of Agric. & Rural Development

Monetary Policy

CRR ( Cash Reserve Ratio)

  • Every Bank need to maintain in the form cash 
  • 4 % of NDTL ( Net Demand & Time Liability )

SLR ( Statutory Liquidity Ratio )

  • 21.50 % of NDTL
  • In the form of Gold, Govt. Securities which are easily converted into cash.

Repo Rate

  • When bank lends money from RBI certain interest has to paid by bank.
  • 7.25%
  • For Short Term\more than 2 days upto 90 days
  • There will be always minimum difference between  Repo Rate & Reverse Repo Rate is 1%

Reverse Repo Rate

  • When bank deposit surplus amount with RBI certain interest has to paid by RBI.
  • 6.25%

Marginal Standing Facility (MSF)

  • Same as Repo Rate ( Scheduled Bank borrow funds overnight from RBI)
  • Short term upto 90 days
  • upto 2 % of  NDTL

Bank Rate

  • long term 
  • Same as Repo Rate

Base Rate

  • Fixed by RBI
  • Below it No loan can provided by any Bank
  • PLR(Prime Lending Rate)
  • Fixed by Bank
  • Loan provided by banks to his customers

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