RESERVE BANK OF INDIA

The Reserve Bank of India (RBI) was established under the Reserve Bank of India Act, 1934 on 1 April 1935 and nationalised on 1 January 1949. The Bank acts as banker to the Central Government, state governments, commercial banks, state co-operative banks and some of the financial institutions. It formulates and administers monetary policy with a view to ensuring stability in prices while promoting higher production in the real sector through proper deployment of credit. RBI plays an important role in maintaining the stability of exchange value of the rupee and acts as an agent of the Government in respect of India’s membership of International Monetary Fund. The Reserve Bank also performs a variety of developmental and promotional functions. These apart, the Reserve Bank also handles the borrowing programme of the Government of India.

The Reserve Bank is the sole authority for issue of currency in India other than one rupee coins and subsidiary coins and notes.

As the agent of the Central Government, the Reserve Bank undertakes distribution of one-rupees notes and coins, as well as small coins issued by the Government.