Money and Banking — Part 2: The Central Bank and Credit Control: visual lesson, CBSE Class 12 Economics

Lesson

The Central Bank and Credit Control

Part 2 — the Reserve Bank of India, its functions, and the instruments it uses to control credit.

In this lesson you will

Part 2 at a glance

Concept

The central bank is the apex institution of the monetary and banking system.

Table comparing the central bank with commercial banks: one versus many, public interest versus profit, deals with government and banks versus the public, and only the central bank issues currency
	Central bank (RBI)	Commercial bank
Number	One for the country	Many
Aim	Monetary and financial stability (public interest)	Profit
Deals with	Government and banks	The public
Issues currency?	Yes (notes except one-rupee notes)	No

Diagram

Six functions of the RBI