Question

What was the role of RBI

Answer 1

The RBI controls the nation’s money supply and is the only authority empowered to print new currency notes. As the production and consumption in the economy rises because of a rise in population or for any other reason, more money is needed to support this growth. RBI prints money primarily based on this growth in the economy and for replacing old and soiled notes.

Answer 2

Answer:

RBI or the Reserve Bank of India issues currency notes on behalf of central government of India. No other organization or individual is legally allowed to do so in the country.

It supervises the functioning of formal sources of credit and sees that the banks give loans not just to profit-making businesses but also to small cultivators, small-scale producers and other small borrowers etc.

It monitors banks in maintaining actual cash balance.

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