BANKING GENERAL KNOWLEDGE
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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RBI keeps bank accounts of the government
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RBI carries out government transactions
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RBI advises the government on all financial and monetary matters
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All of the above
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Detailed explanation-1: -The RBI acts as banker to the government the Central as well as state governments. As such, it transacts all banking business of the government, which involves the receipt and payment of money on behalf of the government and carrying out of its exchange, remittance and other banking operations.
Detailed explanation-2: -As a banker to the Government, the Reserve Bank receives and pays money on behalf of the various Government departments. The Reserve Bank also undertakes to float loans and manage them on behalf of the Governments.
Detailed explanation-3: -The Banking Regulation Act, 1949 together with the RBI Act, gives us the power to regulate and supervise commercial banks and cooperative banks. The Foreign Exchange Management Act, 1999 empowers the RBI to regulate the foreign exchange market.
Detailed explanation-4: -It carries out banking business of the government and the government keeps its cash balances on current account with the Central Bank. It issues loans and advances to the government and does buying and selling of securities on behalf of government.