14th May 2012, 10:11 PM
Join Date: May 2012
Posts: 1

RBI control money datery policy? What is the history of SBI?

please tell me how rbi control moneydatery policy and also the history of sbi

15th August 2016, 05:10 PM
Senior Member+++++
Join Date: Mar 2012
Posts: 5,352
Default Re: RBI control money datery policy? What is the history of SBI?

RBI stands for Reserve Bank of India. It controls inflation and deflation through monetary policy and there are various tools for control of inflation and deflation.

Some of the important quantitative tools for monetary policy are:

1. Reserve ratios: CRR, SLR.

2. Open Market operations.

3. Policy rate.

In qualitative tools are moral suasion and direct action.

At present, Cash reserve ratio is 4% and SLR is 22% of Net Demand and Time Liability. Suppose there is inflation in market then RBI increases CRR, SLR and then commercial banks have less amount to lend, so they increase interest rate, public takes less loans, purchasing power decreases, prices of commodity is decreased to attract customers and inflation is controlled.

History of SBI:

In British India, there were three banks Bank of Bengal, Bombay and Madras and all were merged to form Imperial bank of India and later it was renamed as State Bank of India and later on got nationalized.

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