banking in india
Role Of The Reserve Bank
Role Of The Reserve Bank Of India As A Regulator
Introduction
The regulators of the Indian financial sector are the Reserve Bank of India, the Ministry of Finance (Income Tax Department), Foreign Exchange Dealers Association of India, Deposit Insurance and Credit Guarantee Corporation, Fixed Income Money Market and Derivatives Association of India and the Clearing Corporation of India Ltd. This paper shall deal with the most important of these regulators, the Reserve Bank of India.
The Reserve Bank of India (RBI) is the central bank of our country. It was established on April 1, 1935 in accordance with the provisions of the Reserve Bank of India Act, 1934, based on the recommendations of the Royal Commission on Indian Currency and Finance (Hilton Young Commission) in 1926. The Central Office of the RBI, which was then located in Calcutta, was permanently moved to Mumbai in 1937. Today the RBI has 22 regional offices, mostly in State capitals. During its inception, the RBI was privately owned with a paid up capital of five crores. On establishment, the RBI was handed over the function of issuing currency by the Government of India and the power of credit control by the then Imperial Bank of India. However, the RBI is now fully owned by the Government of India post-nationalisation in 1949. The reasons behind the nationalisation of the RBI were twofold: first, to control inflation in India which existed since 1939 and second, in order to utilise it as a tool for economic change in India at a point of time when India was prepared to set out on its journey of economic growth and development.
This paper shall discuss how exactly the RBI carries out its intended functions. In section II, this paper shall discuss the basic functions of the RBI. In section III, the author shall elaborate upon the organisational structure of the RBI and in section IV the author shall elaborate upon the specific role of the RBI as a regulator.
Basic
Role Of The Reserve Bank Of India As A Regulator
Introduction
The regulators of the Indian financial sector are the Reserve Bank of India, the Ministry of Finance (Income Tax Department), Foreign Exchange Dealers Association of India, Deposit Insurance and Credit Guarantee Corporation, Fixed Income Money Market and Derivatives Association of India and the Clearing Corporation of India Ltd. This paper shall deal with the most important of these regulators, the Reserve Bank of India.
The Reserve Bank of India (RBI) is the central bank of our country. It was established on April 1, 1935 in accordance with the provisions of the Reserve Bank of India Act, 1934, based on the recommendations of the Royal Commission on Indian Currency and Finance (Hilton Young Commission) in 1926. The Central Office of the RBI, which was then located in Calcutta, was permanently moved to Mumbai in 1937. Today the RBI has 22 regional offices, mostly in State capitals. During its inception, the RBI was privately owned with a paid up capital of five crores. On establishment, the RBI was handed over the function of issuing currency by the Government of India and the power of credit control by the then Imperial Bank of India. However, the RBI is now fully owned by the Government of India post-nationalisation in 1949. The reasons behind the nationalisation of the RBI were twofold: first, to control inflation in India which existed since 1939 and second, in order to utilise it as a tool for economic change in India at a point of time when India was prepared to set out on its journey of economic growth and development.
This paper shall discuss how exactly the RBI carries out its intended functions. In section II, this paper shall discuss the basic functions of the RBI. In section III, the author shall elaborate upon the organisational structure of the RBI and in section IV the author shall elaborate upon the specific role of the RBI as a regulator.
Basic
Bibliography: Primary Sources: Banking Regulations Act, 1949 Reserve Bank of India Act, 1934 Secondary Sources: Books: M.L.Tannan, Tannan 's Banking Law and Practice, New Delhi (2004) P.K.Srivastava, Banking Theory and Practice, Mumbai (2007) R.P.Nainta, Banking Systems, Frauds and Legal Control, New Delhi (2005)