The financial institution of India mainly comprises of the central bank which is better known as the Reserve Bank Of India (RBI),the commercial banks the credit ratings agencies, the securities and exchange board of India, insurance companies specialized funancial institutions in India.
The Reserve Bank Of India is the nervous centre of the monetary system of the country. It is the central bank of the counrty and it started operating since April 1, 1935 subsequent to RBI Act in 1934 under private shareholder's institutions.
The central government is now empowered to appoint directors, Deputy Governors, and Governors of the bank.The position of the bank is that it is a state owned institution. This transfer to public ownership from private shareholder's institution came with the RBI act in 1948.
The Reserve Bnak Of India is empowered to control, regulate, guide and supervise the financial system of the country through its monetary and credit policie. These are RBI in 1934, Banking Regulations Act 1949, companies Act 1956 (Applicable to Co-operaive Socities),and Banking Laws Act 1963.
The Reserve Bank Of India has several funtions to perform. Traditionally, it is the banker's bank, and banker to state and central governments. It is also a banker to the commercial banks.
