10th Class Social Science Money and Credit Question Bank 10th CBSE Social Science Money and Credit

  • question_answer   Which government body supervises the functioning of formal sources of loans in India? Explain its functioning.

    Answer:

                      The Reserve Bank of India (RBI) supervises the functioning of formal sources of loans in India. For instance, banks maintain a minimum cash balance out of the deposits they receive. The RBI monitors that the banks actually maintain this cash balance. Similarly, the RBI ensures that the banks give loans not just to profit-making businesses and traders, but also to small cultivators, small scale industries, small borrowers, etc. Periodically, banks have to submit information to the RBI on how much they are lending, to whom, at what interest rate, etc.


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