History of banking The use of money as a unit of account predates history. Government control of money is documented in the ancient Egyptian economy BC. As many other currencies, the shat was linked to gold. The value of a shat in terms of goods was defined by government administrations.
Preamble[ edit ] The preamble of the Reserve Bank of India describes the basic functions of the reserve bank as: The bank was set up based on the recommendations of the Royal Commission on Indian Currency and Finance, also known as the Hilton—Young Commission.
However, it was decided to replace the lion with the tiger, the national animal of India. The Preamble of the RBI describes its basic functions to regulate the issue of bank notes, keep reserves to secure monetary stability in India, and generally to operate the currency and credit system in the best interests of the country.
After the Partition of India in Augustthe bank served as the central bank for Pakistan until June when the State Bank of Pakistan commenced operations. The administration nationalized commercial banks  and established, based on the Banking Companies Act, later called the Banking Regulation Acta central bank regulation as part of the RBI.
Furthermore, the central bank was ordered to support economic plan with loans. Meant to restore the trust in the national bank system, it was initialized on 7 December The Indian government founded funds to promote the economy, and used the slogan "Developing Banking".
The government of India restructured the national bank market and nationalized a lot of institutes. As a result, the RBI had to play the central part in controlling and supporting this public banking sector. The banks lent money in selected sectors, like agricultural business and small trade companies.
Their results had an effect on the RBI. The Indian financial market was a leading example for so-called "financial repression" Mckinnon and Shaw.
New guidelines were published in to establish a private banking sector. This turning point was meant to reinforce the market and was often called neo-liberal. It should improve the item in — National Electronic Fund Transfer. The Government of India appoints the directors for a four-year term.
The Board consists of a governor, and not more than four deputy governors; four directors to represent the regional boards;  2 — usually the Economic Affairs Secretary and the Financial Services Secretary — from the Ministry of Finance and 10 other directors from various fields. One is nominated from among the Chairpersons of public sector banks and the other is an economist.
Venugopal Reddy and Duvvuri Subbarao. Other persons forming part of the central board of directors of the RBI are Dr. The representations are formed by five members, appointed for four years by the central government and with the advice of the central board of directors serve as a forum for regional banks and to deal with delegated tasks from the Central Board.
It has four members, appointed for two years, and takes measures to strength the role of statutory auditors in the financial sector, external monitoring and internal controlling systems. Tarapore to "lay the road map" to capital account convertibility.
The five-member committee recommended a three-year time frame for complete convertibility by — The central bank of any country executes many functions such as overseeing monetary policy, issuing currency, managing foreign exchange, working as a bank for government and as a banker of scheduled commercial banks.
It also works for overall economic growth of the country. The preamble of the Reserve Bank of India describes it main functions as: Financial Supervision[ edit ] The primary objective of RBI is to undertake consolidated supervision of the financial sector comprising commercial banks, financial institutions and non-banking finance companies.
The Board is constituted by co-opting four Directors from the Central Board as members for a term of two years and is chaired by the governor. The deputy governors of the reserve bank are ex-officio members.
One deputy governor, usually, the deputy governor in charge of banking regulation and supervision, is nominated as the vice-chairman of the board. The Board is required to meet normally once every month.
It considers inspection reports and other supervisory issues placed before it by the supervisory departments. BFS through the Audit Sub-Committee also aims at upgrading the quality of the statutory audit and internal audit functions in banks and financial institutions.
The audit sub-committee includes deputy governor as the chairman and two Directors of the Central Board as members.Nov 09, · India’s government is asking the central bank to hand over a part of its surplus reserves and loosen liquidity norms for lenders -- demands that are likely to escalate a standoff with the.
Organisation unifying the entirety of Indian Central Government Employees and Workers on a single platform of struggle and advance. To enable the Bank to meet the objectives of a central bank, it is vested with comprehensive legal powers under the following legislation to regulate and supervise the financial system.
The Central Silk Board (CSB) is a Statutory Body under Ministry of Textiles, Government of India and is a national organization for overall development of sericulture and silk industry.
Its . An approved BC/DR policy is in place. In case any branch is unable to function due to any calamity or disaster, its customers can continue their transactions through any other branch. Plans rolled out by the People’s Bank of China will help small businesses and accelerate the pace of debt-for-equity swaps.