Question

Which of the following is not a function of RBI ?

• A. Accepting Deposits
• B. Controls the supply of money and credit
• C. Acts as the Government's Bank
• D. Printing and issuing currency

Answer 1

Answer:

A. Accepting Deposits

Core Functions of the Reserve Bank of India (RBI)

• Monetary Authority: Formulates, implements, and monitors the monetary policy to maintain price stability and ensure adequate credit flow to productive sectors.

• Regulator and Supervisor of the Financial System: Prescribes broad parameters of banking operations within which the country's banking and financial system functions (e.g., Banking Regulation Act, 1949).

• Manager of Foreign Exchange: Manages the Foreign Exchange Management Act (FEMA), 1999, to facilitate external trade and payment and promote orderly development of the foreign exchange market.

• Issuer of Currency: Issues and exchanges or destroys currency and coins not fit for circulation to maintain the currency system.

• Developmental Role: Performs a wide range of promotional functions to support national objectives, such as financial inclusion and rural credit development.

• Banker to the Government: Performs merchant banking functions for the Central and State Governments and acts as their banker.

• The RBI was established under the Reserve Bank of India Act, 1934 and commenced operations on April 1, 1935. It was nationalized in 1949.