Question

commercial banks creates active deposits by
1.Collecting deposit
2.Reserve bank grants
3.Advancing loans
4.Utility services

Answer 1

Answer:

collecting deposits.

Answer 2

Option 2) Reserve bank grants

Commercial banks creates active deposits by Reserve bank grants

• In an economy, commercial banks are responsible for creating credit. As a result, commercial banks' new money is referred to as credit money.
• Additionally, the Reserve Bank agrees to issue loans and administer them on behalf of the Governments. It offers the governments Ways and Means Advances, a short-term interest-bearing advance, to cover brief discrepancies between their receipts and payments.
• Neither income tax nor stamp duty are owed by the RBI. In fact, the government has owned the RBI since 1949. Therefore, any profit it makes is owned by the government. The RBI can make money by simply buying and selling at the same time, which it can then provide to the government.
• Deposit mobilisation is the process by which financial institutions accumulate public cash or money through various channels, such as savings, current, fixed deposit accounts, and other specialised schemes.
• Money is not made by commercial banks. Demand deposits are produced by commercial banks, increasing the money supply.

#SPJ2