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What are the functions of RBI?
  • a)
    Supervises the formal sources of loan
  • b)
    Monitors whether banks actually maintain the cash balance or not
  • c)
    Ensures that the ban ks give loan not just to profit making businesses and traders but also to small scale industries and borrowers too.
  • d)
    All of them
Correct answer is option 'D'. Can you explain this answer?
Most Upvoted Answer
What are the functions of RBI?a)Supervises the formal sources of loanb...
Functions of RBI
The Reserve Bank of India (RBI) plays a crucial role in the Indian economy. Its functions are multifaceted, aimed at ensuring the financial stability and growth of the banking sector. Here’s a detailed explanation of its key functions:
Supervision of Loan Sources
- The RBI supervises formal sources of loans, ensuring that banks adhere to established regulations.
- This supervision helps maintain the integrity of financial institutions and protects consumers from unfair practices.
Monitoring Cash Balances
- The RBI monitors whether banks maintain the required cash balance, known as the Cash Reserve Ratio (CRR).
- By ensuring that banks hold a certain percentage of their deposits as reserves, the RBI promotes liquidity and stability in the banking system.
Promoting Inclusive Lending
- The RBI ensures that banks provide loans not just to profit-making businesses but also to small-scale industries and individual borrowers.
- This function is vital for promoting economic equality and supporting various sectors of the economy, fostering overall growth.
Conclusion
- The functions outlined above highlight the RBI’s role in supervising, monitoring, and promoting inclusive lending.
- Therefore, the correct answer is option 'D' as all the mentioned functions are integral to the RBI’s mandate in maintaining a balanced and robust financial ecosystem in India.
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Community Answer
What are the functions of RBI?a)Supervises the formal sources of loanb...
RBI also monitors how much the banks are lending, to whom and at what interest rate.
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What are the functions of RBI?a)Supervises the formal sources of loanb)Monitors whether banks actually maintain the cash balance or notc)Ensures that the ban ks give loan not just to profit making businesses and traders but also to small scale industries and borrowers too.d)All of themCorrect answer is option 'D'. Can you explain this answer?
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What are the functions of RBI?a)Supervises the formal sources of loanb)Monitors whether banks actually maintain the cash balance or notc)Ensures that the ban ks give loan not just to profit making businesses and traders but also to small scale industries and borrowers too.d)All of themCorrect answer is option 'D'. Can you explain this answer? for Class 10 2024 is part of Class 10 preparation. The Question and answers have been prepared according to the Class 10 exam syllabus. Information about What are the functions of RBI?a)Supervises the formal sources of loanb)Monitors whether banks actually maintain the cash balance or notc)Ensures that the ban ks give loan not just to profit making businesses and traders but also to small scale industries and borrowers too.d)All of themCorrect answer is option 'D'. Can you explain this answer? covers all topics & solutions for Class 10 2024 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for What are the functions of RBI?a)Supervises the formal sources of loanb)Monitors whether banks actually maintain the cash balance or notc)Ensures that the ban ks give loan not just to profit making businesses and traders but also to small scale industries and borrowers too.d)All of themCorrect answer is option 'D'. Can you explain this answer?.
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