RBI enjoy the sole right to issue the currency notes of various denominations except ₹ 1/- note which is issued by ministry of finance. RBI manages the Foreign Exchange Management Act, 1999, to facilitate external trade and payment and promote orderly development and maintenance of foreign exchange market in India.

Improving security and efficiency in modes of payment.

Enhancement of customer convenience in payment systems.

Setting up of the regulatory framework of newer payment methods.

Policies for encouraging the movement from paper-based payment systems to electronic modes of payments.

Prescribes standards for working of the payment system.

Authorises setting up of payment systems.

Regulator and supervisor of the Payment System – Objective: maintain public confidence in the system, protect depositors’ interest and provide cost-effective banking services to the public. Prescribes broad parameters of banking operations within which the country’s banking and financial system functions. Regulator and Supervisor of the Financial System –

Objective : maintaining price stability while keeping in mind the objective of growth.

Formulates, implements and monitor the monetary policy.

Here are the main roles and functions of Reserve Bank of India in Indian Banking System: Reserve Bank of India – Role of RBI in Indian Banking System Main Role and Functions of RBI in Indian Banking System

Others : 4 Directors from four local boards.

Nominated by Government : 10 Directors from various fields and two government Officials.

Reserve Bank of India Organisation Structure The 21 member central board of directors is appointed by the Government of India for a period of 4 years, according to the provisions of Reserve Bank of India Act. RBI’s operations are governed by central board of directors.

“to regulate the issue of Bank notes and keeping of reserves with a view to securing monetary stability in India and generally to operate the currency and credit system of the country to its advantage to have a modern monetary policy framework to meet the challenge of an increasingly complex economy, to maintain price stability while keeping in mind the objective of growth.” Organisation Structure and Constitution The Preamble of RBI describes the basic functions of Reserve Bank as : Now RBI is fully owned by Government of India. Though originally privately owned, was nationalized in 1949.

Now, Central Office of RBI is permanently situated in Mumbai since 1937. Reserve Bank was estabilished on Apin Calcutta under the provisions of Reserve Bank of India Act, 1934. Reserve Bank of India (RBI), India’s central banking institution.

Role and functions of rbi