In what ways the reserve bank of india supervise the functioning of banks
Answers
Answer:
In number of ways a reserve Bank can function and supervise the banking system
Explanation:
RBI has the Monopoly in the note issue in India.reserve Bank of India has the powers to force weak or unsound banks to amalgamate.every new Bank setup must first acquire the RBI priority permission to do so and to act according to the RBI's specifications.RBI has also laid down special rules and regulations regarding employment of banks and accountant of board of directors of bank. RBI can issue licence regarding banking facilities. RBI is known as bankers Bank in India. RBI RBI can sell the securities so that excess currency is mopped up from the market , also the central bank of India or Reserve Bank of India has has the power to change cash reserve ratio statutory liquid ratio as it deems fit the circumstances liquidity position of the bank is affected due to the variation of these ratios and hence their ability to lend is also affected by rising the ratios and excessive credit expansions by the banks can be reduced and inflation can be controlled while lowering the ratios and a positive effect can be generated.
Answer:
RBI has the Monopoly in the note issue in India.reserve Bank of India has the powers to force weak or unsound banks to amalgamate.every new Bank setup must first acquire the RBI priority permission to do so and to act according to the RBI's specifications.RBI has also laid down special rules and regulations regarding employment of banks and accountant of board of directors of bank. RBI can issue licence regarding banking facilities. RBI is known as bankers Bank in India. RBI RBI can sell the securities so that excess currency is mopped up from the market , also the central bank of India or Reserve Bank of India has has the power to change cash reserve ratio statutory liquid ratio as it deems fit the circumstances liquidity position of the bank is affected due to the variation of these ratios and hence their ability to lend is also affected by rising the ratios and excessive credit expansions by the banks can be reduced and inflation can be controlled while lowering the ratios and a positive effect can be generated.
Explanation: