What is RBI

Normally everyone knows about the bank everyone uses the bank for various purposes, every country has a lot of banks available, just as India also has a lot of available banks and everyone uses the different types of banks as per their requirement.

If you are an Indian, it is obvious that you will be using Indian currency, because online payment is not available in all places, and you must have seen on all currencies that Reserve Bank India is written on them, what does it mean.

What is RBI

Full form of RBI is Reserve Bank of India RBI is a bank which is one of the most important part of the banking system even though RBI is India’s largest bank and rbi takes all decisions related to banking, but RBI is not the oldest bank of India.

Many other banks were established before the establishment of RBI, what is the initial banking system of India, which was the first bank in India and which was the oldest bank.

Need to setup RBI

For every type of transaction in any country, it is necessary to have a currency that is valid everywhere and that the currency is certified and controlled by a particular system.

And before the establishment of RBI, there was no such system, bank, organization, etc., which is officially controlled by a particular organization, just as at this time a common currency is used over the country and RBI controls it.

So the trend of different types of currencies in the same country was not good at all, although different types of currencies existed in India at that time, but the East India company also launched a number of currencies, so more different currencies were available.

So there was a need for a system that could implement one type of currency in the entire country and fully control the currency in its hands, and also provide banking services.

And in 1926 Royal Commission (Hilton Young Commission) proposed a Central Bank “Reserve Bank of India” for Indian currency, https://m.RBI.org.in/scripts/chro_1926.aspx.

RBI was established in Kolkata on 1 April 1935, although proposed by the royal commission but Babasaheb Dr. Bhimrao Ambedkar played an important role, rbi was formed only on the basis of suggestions made by Babasaheb Dr. Bhimrao Ambedkar, and perhaps very few people know that Babasaheb Dr. Bhimrao Ambedkar had an important role in the establishment of RBI.

The RBI was established in Kolkata and the first bank in India with which integration SBI was founded “Bank of Calcutta” was also started from here.

Though the RBI was established in Kolkata and the headquarter was there as well, in 1937 the RBI headquarters was shifted to Mumbai, and from that time till now its headquarter is in mumbai.

Changes in RBI after country’s independence

East India Company ruled India for a long time and RBI was also established during his reign and after the independence of the country, RBI was nationalized on 1 January 1949. Although the bank was private at the time of RBI’s establishment and even after that, but with nationalization, RBI was fully proposed as a government bank and today RBI is handling India’s banking system.

Founder of RBI

RBI was founded by the royal commission (British Raj)

Although RBI was private, RBI is a government bank since 1949 after independence

RBI governor l

The current governor of the RBI is Shaktikanta Das (Retired IAS) and overtime multiple Governors have bn replaced there are a list of that

Sir Osborne Arkell Smith, was the first governor of the RBI who was the RBI governer in the British Raj of RBI, his tenure was from 1 April 1935 to 30 June 1937.
RBI’s second governor was Sir James Braid Taylor, tenure – 1 July 1937 to 17 February 1943
Sir C. D. (Chintaman Dwarakanath) Deshmukh, tenure – 11 August 1943 to 30 June 1949
Sir Benegal Rama Rao, Tenure – 1 July 1949 to 14 January 1957, he was the first governor of RBI who was completely under India as he became the first governor after 1947 independence.
KG Ambegaonkar, tenure – 14 January 1957 to 28 February 1957
HVR R Iyengar, Tenure – 1 March 1957 to 28 February 1962
P. C. Bhattacharya, tenure – 1 March 1962 to 30 June 196
BNN Honor, tenure – 4 May 1970 to 15 June 1970
S. Jagannathan, Tenure – 16 June 1970 to 19 May 1975
NC Sengupta, tenure – 19 May 1975 to 19 August 1975
KR Puri, tenure – 20 August 1975 to 2 May 1977
M. Narasimhan, Tenure – 3 May 1977 to 30 November 1977
IG Patel, Tenure – 1 December 1977 to 15 September 1982
Dr. Manmohan Singh, tenure – 16 September 1982 to 14 January 1985
A. G. Ghosh, Tenure – 15 January 1985 to 4 February 1985
RN Malhotra, Tenure – 4 February 1985 to 22 December 1990
S. Venkataramanan, Tenure – 22 December 1990 to 21 December 1992
C. Rangarajan, Tenure – 22 December 1992 to 21 November 1997
Bimal Jalan, tenure – 22 November 1997 to 6 September 2003
Y4V Reddy, tenure – 6 September 2003 to 5 September 2008
D. Subbarao, Tenure – 5 September 2008 to 4 September 2013
Raghuram Rajan, tenure – 5 September 2013 to September 2016
Urjit Patel, tenure – September 2016 to 10 December 2018
Shaktikanta Das, tenure – 11 September 2018 to present time

RBI controls Indian currency

The management of Indian currency is done by RBI and printing of currency notes is the responsibility of the RBI, as per RBI’s order, the printing of currency is done in 4 different locations under the supervision of “Security Printing & Minting Corporation of India Ltd”.

Although currency printing is in the hands of RBI, RBI also cannot print the notes of its own accord as the printing of notes is decided according to the growth rate of the country, which also requires the approval of the government.

Because if the RBI will ignore the growth rate and print the notes, then the currency will have no value, and Venezuela has done so. The central bank of Venezuela had printed the currency ignoring the growth, which had a very bad result, their Inflation had increased a lot.

Under the minimum reserve system 1956, the RBI has to maintain a minimum amount of 200 crores.

What is the cost of RBI for the printing of notes
2.93 INR per 200 note
2.94 INR per 500 note
3.94 INR per 2000 note

Currency exchange

Recently, a historic decision was taken on 8 November 2016, and currency exchange was done by RBI on the order of the Indian government.

In the past, all the notes were withdrawn from the people by the RBI new notes were issued, only the notes presented in the new look by RBI are in trend at the present time, although in this process people have little problem Had to face it but after some time everything became normal, as old notes were to be withdrawn from all over India and sent to them.

India’s largest bank, bank of banks

However RBI is not the oldest or first bank of India as RBI was established in 1935 and it was nationalized in 1949 as the functioning of RBI was working differently than other banks as suggested by Babasaheb Ambedkar and Due to its system of functioning, it was chosen as the central bank of India and nationalized.

Since RBI is a central bank, it is the responsibility of the RBI to manage the banking system, hence the RBI also controls all other banks in India, that’s why RBI is called the bank of banks.

All banks follow the guidelines of RBI, just recently yes bank was on the verge of sinking, which led the rbi to its rescue mission, which was the debit limit of 50,000 INR, although soon the RBI had removed the limit.

Although there are plenty of banks available all over the country who offer different types of services, loan, but let’s say that if the condition of those banks becomes too bad, or if the bank is on the verge of sinking, This will affect different types of institutions, people, etc.

If only one bank sinks then a lot of people may have to face the problem, so due to being the head of the Indian banking system, RBI also tries to protect it in a proper way. So that it can be saved and even loans are provided.

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