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PRESENTED BY
YADNESH KENE
SUBMITTED TO
Mrs. RENUKA MADAM
REGULATORY ROLE OF RBI AND
MONETARY POLICY
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INTRODUCTION The Reserve Bank of India (RBI) is India's central banking institution,
which formulates the monetary policy with regard to the Indian rupee.
It was established on 1 April 1935 during the British raj in accordance
with the provisions of the Reserve Bank of India Act, 1934.
The share capital was divided into shares of 100 each fully paid, which
was entirely owned by private shareholders in the beginning.
Following India's independence in 1947, the RBI was nationalized inthe year 1949.
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MEANING & DEFINITION
The central bank of India, which was established on
April 1, 1935, under the Reserve Bank of India Act.
The RBI uses monetary policy to create financial
stability in India and is charged with regulating the
country's currency and credit systems.
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FUNCTION OF RBI
The Reserve Bank of India is the central bank of
India it was established as a shareholders bank
on 1st April 1935. Its share capital was Rs. 5
crore, divided in to 5 lakhs fully paid up shares of
Rs. 100 each. On 1st January 1949 it was
nationalized. Its headquarters is at Mumbai. RBI,
like any other bank performs almost all traditional
Central banking functions. Due to countrys
development it has also undertaken
developmental and promotional functions.
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ROLE & FUNCTION OF RBI
Issue Of Currency Notes
Banker To The Government
Bankers bank And Lender Off Last Resort
Controller Of Credit
Exchange control And Custodian Of Foreign Reserve
Collection And Publication Of Data
Regulatory And Supervisory Functions Clearing House Functions
Development And Promotional Functions
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MONETARY POLICY Monetary policy is a regulatory policy by which the
central bank or monetary authority of a countrycontrols the supply of money, availability of bankcredit and cost of money, that is, the rate of Interest.
An important tool of economic management in India.
RBI controls the supply of money and bank credit.
RBI rightly calls its credit policy as one of controlledexpansion.
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OBJECTIVES OF MONETARY POLICY
Growth With Stability
Regulation, Supervision And Development Of Financial
Stability
Promoting Priority Sector
Generation Of Employment
External Stability
Encouraging Savings And Investments Redistribution Of income And Wealth
Regulation Of NBFIs
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MONETARY POLICY OF RBI FOR
CONTROL OF CREDIT
QUANTITATIVE CREDIT CONTROL METHODS
Bank Rate Policy
Open market operations Cash Reserve Ratio
Statutory Liquidity Ratio
Repo And Reverse Repo Rates
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QUALITATIVE CREDIT CONTROL
METHODS
Ceiling On Credit
Margin Requirements
Discriminatory Interest Rate Directives
Direct Action
Moral Suasion
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ACHIEVEMENT & FAILURES
ACHEIVEMENTS
Short Term Liquidity Management
Financial Stability
Adaptability Increase In Growth
Increase In Bank Deposits
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FAILURES
Huge Budgetary Deficits
Coverage Of Only Commercial Banks
Problem Of Management Of Banks And Financial
Institutions Black Money
Lack Of Transparency
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CONCLUSION
It can be said that despite several problems RBI
has made a good effort for effective
implementation of the monetary policy in India.
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