The Reserve Bank of India (Hindi ：भारतीय रिज़र्व बैंक， English: RBI) is the central bank of India and an independent body responsible for the supervision of Indian banks. It is responsible for issuing and supplying Indian rupees, and also manages the country's main payment system.

The general policy direction of the Reserve Bank of India is determined by the 21-member Central Council, which includes: the Governor, 4 Deputy Governors, 2 representatives of the Ministry of Finance (usually the Secretary of Economic Affairs and the Secretary of Financial Affairs); 10 government-nominated directors, and 4 directors representing the local boards of Mumbai, Kolkata, Chennai, and Delhi. Each local board consists of 5 members representing regional interests as well as those of the cooperative banks and local banks.

The Reserve Bank of India is a member of the Asian Clearing Union. It is also active in promoting inclusive financial policies and is one of the key members of the Alliance for Financial Inclusion (AFI). The Reserve Bank of India is often referred to locally as "Mint Street".

Functions

According to the Preamble to the Reserve Bank of India Act, the basic functions of the Reserve Bank of India are as follows:

Regulate the issuance of bank bills and the custody of reserves to ensure the stability of India's currency and to operate the country's monetary and credit system as a whole to its advantage; establish a modern monetary policy framework to meet the challenges posed by an increasingly complex economy and maintain price stability while keeping in mind growth objectives. " 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 challenges of an increasingly complex economy, to maintain price stability while keeping in mind the objective of growth. "

History

Before the establishment of the Monetary Policy Committee of India in 2016, the Reserve Bank of India had The Reserve Bank of India was established by the Reserve Bank of India Act, passed by the Central Legislative Assembly in 1934, and was formally established on April 1, 1935. Its original shares were divided into 100 fully paid-up shares. Initially privately owned, the Reserve Bank of India was nationalized on January 1, 1949, after India gained independence on August 15, 1947, and was fully owned by the Indian government. Even though Burma withdrew from British India in 1937, the bank was the central bank of Burma until April 1947; similarly, even after the partition of India and Pakistan in 1947, the bank was the central bank of Pakistan until June 1948.

On July 11, 2022, the Reserve Bank of India introduced a rupee settlement mechanism for international trade with immediate effect

Branches and Supporting Institutions

The Reserve Bank of India has 4 regional representatives: New Delhi (North), Chennai (South), Kolkata (East), Mumbai (West). The representative is composed of five members appointed by the central government for a four-year term and is responsible for advising the central board, which serves as a forum for regional banks, and handling tasks entrusted by the central board.

The RBI has 31 branches in India, the vast majority of which are located in the capital cities of the states, with the exception of the Nagpur branch (which is actually the second capital of Maharashtra)

The central bank has two colleges for training staff, the Reserve Bank Staff College in Chennai and the Agricultural Bank of China College in Pune. The central bank also has three autonomous institutions, namely the National Bank Management Institute (NIBM), the Indira Gandhi Institute for Development Research (IGIDR) and the Institute of Banking Technology Development (IDRBT). It also has four regional training centres in Mumbai, Chennai, Kolkata and New Delhi.

Governor

In December 2018, Central Bank Governor Urjit Patel resigned, becoming the first RBI governor to resign while in office since the 1990s. According to media reports, he is generally believed to have resigned due to dissatisfaction with Indian Prime Minister Narendra Modi's interference in central bank decision-making.

The current governor is Shaktikanta Das.

Publications

As required by the Banking Supervision Act 1949, the RBI publishes an annual report entitled "Trend and Progress of Banking in India", which summarizes trends and developments across the financial sector. Since April 2014, the RBI has started issuing policy updates every two months.