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India's Central Bank and it's Effort to Revive the Economy

Reviving India's Banking Sector

Reviving India's Banking Sector

Banking sector was emerged long year ago, It is mainly to accept demand deposits and gives loan to needy peoples by landlords and coporates.

 Later, Hilton young commission suggest that every country needs a central bank to control the banks and it's operation. So, it constituted RBI as the India's central bank through RBI Act 1934.

 Now, RBI has the power to control money in the market through various qualitative and quantitative instruments like reporate, reverse repo rate etc.. , issue guidelines to bank about it's performance and necessary things to do for better banking operations.


Recently, It announced the Repo rate cuts of 75 bps to 4.4% , Reverse repo rate cuts of 115 bps to 3.75%, CRR of 3% cuts from 4%, SLR of 18% due to the deadly Corona virus pandemic.

 All these points cuts is for increase money circulation in public who are now unable to go for their work because of lockdown and also it announced moratorium period of three months to repay the loan amounts and also RBI announced 50000 crore for agricultural, micro, small and medium enterprises, industry sector through NABARD, SIDBI, MFI to revive the growth of these sector.

 These announcement from RBI definitely will improve the growth of manufacturing and industrial sector.

Apart from that, Few month ago, Punjab and Maharastra Co-Operative bank was in trouble due to lack capital for that it formed a committee under Bhagwan bhoria to revive the Punjab and Maharastra Co-Operative bank.

After the PMCB crisis, RBI directs all the co-operative banks are under the control of NABARD regulatory and supervision frame works and also formed the committee under Prashant Kumar to retrack the  growth of yes bank under "Yes bank reconstruction scheme 2020"
and now those two bank are in right track to improve the banking sector.

All these are happened because of RBI supervision and regulatory framework.

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