Question

Difference between rbi act and banking regulation act

Answer 1

Banking Regulation Act, 1949. TheBanking Regulation Act, 1949 is a legislation in India that regulates allbanking firms in India. ... Initially, the law was applicable only to bankingcompanies. But, 1965 it was amended to make it applicable to cooperativebanks and to introduce other changes.

Answer 2

The RBI Act determines the roles and responsibilities of the RBI for effectively managing the flow of money in the country. The banking regulation Act defines the process of monitoring and controlling the use of bank assets and funds  by the banks

Explanation:

• The banking regulation Act keeps a control on the use of banking assets, create effective control through provision of inter-banking facilities, track and monitor the diversion of funds by the banks
• The RBI act  is mainly responsible for efficient function of the RBI and controlling the supply of money and credit by the various banks and the financial institutions in the country. The Act provides total supervision of the "Forex reserves" of the country  along with ensuring financial stability of the economy.
• The banking regulation Act also controls the opening of bank branches in the country and changing the location of the banks. It controls the competition among the banks. It ensures the development of the banking sector through various measures

To know more about Reserve Bank of India Act

The reserve bank of India (RBI) acts as a bankers' bank. What does it mean?

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