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Static GK has always played an important role in various banking, government and insurance exams, however it is considered to be easy by the aspirants preparing for these important exams. Static GK has always been a favourite for examiner’s point of view and it is quite easy to prepare because of the reason that Static GK don’t have information updated on regular basis and it is simply to be memorized. This is because of the reason that most likely answers to the questions related to Static GK don’t change. For instance a fact would remain a fact and it can’t be changed, so similar is the case with static GK. Therefore, these static GK PDFs are easy to answer and memorize. In this article we have come up with details on knowing your Central Bank which is the Reserve Bank of India. From this questions have been asked in the exams previously, thus it is important to download this free PDF and learn these simple facts about the Reserve Bank of India. Also, below mentioned are few sample questions that may be asked in the exam:

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Sample Questions on Know Your Central Bank

Question 1: On whose recommendations was the Reserve Bank of India was set up?

Answer: Hilton Young Commission.

Question 2: What are the basic functions of the Reserve Bank described in The Preamble of the Reserve Bank of India?

Answer: “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 challenge of an increasingly complex economy, to maintain price stability while keeping in mind the objective of growth.”

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Question 3: The Reserve Bank of India performs the supervisory function under the guidance of?

Answer: The Board for Financial Supervision (BFS)

Question 4: The Board for Financial Supervision (BFS) was constituted in?

Answer: November 1994.

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Question 5: What does the emblem of Reserve Bank of India shows?

Answer: The emblem of Reserve Bank of India has Royal Bengal tiger standing in front of a palm tree.

Question 6: RBI logo was inspired from?

Answer: It was inspired from East India Company’s Double Mohur.

Question 7: Who was the  first governor of RBI?

Answer: Sir Osborne Smith

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Question 8: When is the the financial year of RBI starts?

Answer: The financial year of RBI is from 1 July to 30 June. The Reserve Bank of India (RBI) has decided to align its financial year with the Government.

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Question 9: Who was the first women Deputy Governor of RBI?

Answer: K J Udeshi

Download Free PDF – Know your Central Bank – Reserve Bank of India

Main Functions of Reserve Bank of India

1. Monetary Authority:

  • Formulates, implements and monitors the monetary policy.
  • Objective: maintaining price stability while keeping in mind the objective of growth.

2. Regulator and supervisor of the financial system:

  • Prescribes broad parameters of banking operations within which the country’s banking and financial system functions.
  • Objective: maintain public confidence in the system, protect depositors’ interest and provide cost-effective banking services to the public.

3. Manager of Foreign Exchange

  • Manages the Foreign Exchange Management Act, 1999
  • Objective: to facilitate external trade and payment and promote orderly development and maintenance of foreign exchange market in India.

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4. Issuer of currency:

  • Issues and exchanges or destroys currency and coins not fit for circulation.
  • Objective: to give the public adequate quantity of supplies of currency notes and coins and in good quality.

5. Developmental role

  • Performs a wide range of promotional functions to support national objectives.

6. Regulator and Supervisor of Payment and Settlement Systems:

  • Introduces and upgrades safe and efficient modes of payment systems in the country to meet the requirements of the public at large.
  • Objective: maintain public confidence in payment and settlement system

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7. Related Functions

  • Banker to the Government: performs merchant banking function for the central and the state governments; also acts as their banker.
  • Banker to banks: maintains banking accounts of all scheduled banks.

Board for Financial Supervision

The Reserve Bank of India performs the supervisory function under the guidance of the Board for Financial Supervision (BFS). The Board was constituted in November 1994 as a committee of the Central Board of Directors of the Reserve Bank of India under the Reserve Bank of India (Board for Financial Supervision) Regulations, 1994.

  • Objective

The primary objective of BFS is to undertake consolidated supervision of the financial sector comprising Scheduled Commercial and Co-operative Banks, All India Financial Institutions, Local Area Banks, Small Finance Banks, Payments Banks, Credit Information Companies, Non-Banking Finance Companies and Primary Dealers.

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  • Constitution

The Board is constituted by co-opting four Directors from the Central Board as Members and is chaired by the Governor. The Deputy Governors of the Reserve Bank are ex-officio members. One Deputy Governor, traditionally, the Deputy Governor in charge of supervision, is nominated as the Vice-Chairman of the Board.

  • BFS Meetings

The Board is required to meet normally once every month. It deliberates on inspection reports, periodic reviews related to banking and non-banking sectors and policy matters arising out of or having relevance to the supervisory functions of the Reserve Bank.

The BFS oversees the functioning of Department of Banking Supervision (DBS), Department of Non-Banking Supervision (DNBS) and Department of Co-operative Bank Supervision (DCBS) and gives directions on regulatory and supervisory issues.

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  • Functions

Some of the initiatives taken by the BFS include:

  1. Fine-tuning the supervisory processes adopted by the Bank for regulated entities;
  2. Introduction of off-site surveillance system to complement the on-site supervision of regulated entities;
  3. Strengthening the statutory audit processes of banks and enlarging the role of auditors in the supervisory process;
  4. Strengthening the internal defences within supervised institutions such as corporate governance, internal control and audit functions, management information and risk control systems, review of housekeeping in banks;
  5. Introduction of supervisory rating system for banks and financial institutions;
  6. Supervision of overseas operations of Indian banks, consolidated supervision of banks;
  7. Technical assistance programme for cooperative banks;
  8. Introduction of scheme of Prompt Corrective Action Framework for weak banks;
  9. Guidance regarding fraud risk management framework in banks;
  10. Introduction of risk based supervision of banks;
  11. Introduction of an enforcement framework in respect of banks;
  12. Establishment of a credit registry in respect of large borrowers of supervised institutions; and
  13. Setting up a subsidiary of RBI to take care of the IT requirements, including the cyber security needs of the Reserve Bank and its regulated entities, etc.

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Some Quick Facts:

  • The first governor of RBI – Sir Osborne Smith
  • The first governor of RBI after nationalization – C. D. Deshmukh
  • The Present Governor of RBI – Shaktikanta Das
  • First Deputy Governor of Reserve Bank of India (RBI) – James B. Taylor
  • The first women Deputy Governor of RBI – K J Udeshi
  • Manmohan Singh is the only Prime Minister to have also served as the Governor of RBI.
  • RBI is responsible only for printing the currency notes. Minting of coins is done by the Government of India.
  • RBI was also the central bank for two other countries. It played the role of Central Bank of Pakistan till June 1948 and the Central Bank of Burma (Myanmar) till April 1947.
  • The financial year of RBI is from 1 July to 30 June. The Reserve Bank of India (RBI) has decided to align its financial year with the Government. The central board of the RBI has decided that the fiscal year 2021-22 for the central bank will begin from April 1. Fiscal 2019-20 will end on June 30, 2020 while fiscal year 2020-21 will begin on July 1, 2020 but ends on March 31, 2021. Thereafter, all fiscal year will start on April 01 every year.

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Download Free PDF – Know your Central Bank – Reserve Bank of India

We hope that this PDF will definitely be useful in your preparation. Download other Static GK PDFS now and improve your preparation for the General Awareness section.

 

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