Reserve Bank Of India Case Study

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Societies could be grouped into several economic segments. There are segments with surplus funds as well as in the same way there are those which have shortages and deficit. A financial system operates as an intermediary and acts as a medium to smoothen the flow of funds from the segments having surplus funds to the segments in deficit. The financial system is a combination and amalgamation of several institutions, regulations distinct markets, proceedings and demands, analysts and liabilities.

Hence, a financial system is a composition of nearly interconnected financial institutions, markets related to finance, financial instruments as well as financial services. The financial system helps to mobilize the capital from the surplus section
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The Reserve Bank of India is the regulator as well as supervisor of the financial system of India. It is the function of the Reserve Bank of India to establish the parameters for functions related to bank, that govern the operations and performance of the banking and financial system in India. The Reserve Bank of India provides security to the depositors' which increases the public trust in the banking system. It also aims to offer inexpensive and affordable banking services to the individuals on the whole. With the establishment of The Banking Ombudsman Scheme, the Reserve bank of India offers for quick addressing of grievances related to banking…show more content…
The Reserve Bank of India maintains the monetary control on the banks of the country by the means of processes such as CRR and SLR, also known as Cash Reserve Ratio and Statutory Liquid Ratio respectively. The CRR and the SLR together with the Bank rate and Repo rate helps to maintain checks and balances on the banks.
6. Reserve Bank of India is also accountable for an effectual payment and settlement system.
7. As the central banking authority, the Reserve Bank of India is empowered to issue currency notes as well as coins. It is too empowered to exchange or destroy the currency notes and coins that are no longer in the condition to be in circulation. Reserve bank of India acts as a medium to maintain the currency as well as the credit system in India to be utilized by public.
8. The Reserve Bank of India regulates and checks the equity as well as the debt market. This market consists of the stock exchange, investment bankers, mutual funds, brokers, listed companies and foreign institutional investors.
9. As the central banking authority, the Reserve Bank of India forms the regulatory framework, administers costs, and controls the investment and the price framework of the insurance enterprises as well as insurance

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