How does RBI supervise the funtion of banks
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They use some private servers to watch what the banks do
RBI has some officials to check the banks if noticed
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The Reserve Bank of India supervises the functioning of formal sources of loans. Banks maintain a minimum cash balance out of the deposits they receive. The RBI monitors the banks in actually maintaining cash balance. The RBI sees that banks give loans not just to profit- making businessmen and traders but also to small cultivators, small scale industries, to small borrowers etc. Periodically banks have to submit information to the RBI on how much they are lending, to whom, at what interest rate etc.
Hope it helps!
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