Question

Explain various credit control measure adopted by central bank​

Answer 1

Explanation:

Quantitative or traditional methods of credit control include banks rate policy, open market operations and variable reserve ratio. Qualitative or selective methods of credit control include regulation of margin requirement, credit rationing, regulation of consumer credit and direct action.

Answer 2

Explanation:

Following are the measures adopted by the central bank to control credit : (i) Bank rate : Bank Credit is controlled by the increase or decrease in bank rate. When credit in the country needs to be expanded then RBI credit bank rate is increased. Loan gets cheaper when bank rate is lower, making the demand of loans higher.