Question:medium
Identify, which one of the following is not a function of Reserve Bank of India as a bank, agent and advisor to the government.
Identify, which one of the following is not a function of Reserve Bank of India as a bank, agent and advisor to the government.
Show Hint
RBI as banker, agent, and advisor deals with government finances, while inspection is part of its supervisory function.
Updated On: Mar 19, 2026
- Carries out banking business of the government
- Manages national debt
- Advises on financial matters
- Conducts periodic inspections
Show Solution
The Correct Option is D
Solution and Explanation
Step 1: Understanding the Concept:
The RBI performs several roles. One specific role is being the "Banker, Agent, and Advisor to the Government."
Step 2: Detailed Explanation:
1. As a Banker: It maintains accounts and carries out banking business for the government (Option A).
2. As an Agent: It manages public debt and issues government securities (Option B).
3. As an Advisor: It provides advice on economic and monetary policy matters (Option C).
4. Periodic Inspections: This falls under the Supervisory Function of the RBI, where it monitors and regulates commercial banks to ensure they follow rules. This is part of being the "Banker's Bank," not the "Banker to the Government."
Step 3: Final Answer:
Option (D) is a function of the RBI as a regulator/supervisor of the banking system, not as an agent to the government.
The RBI performs several roles. One specific role is being the "Banker, Agent, and Advisor to the Government."
Step 2: Detailed Explanation:
1. As a Banker: It maintains accounts and carries out banking business for the government (Option A).
2. As an Agent: It manages public debt and issues government securities (Option B).
3. As an Advisor: It provides advice on economic and monetary policy matters (Option C).
4. Periodic Inspections: This falls under the Supervisory Function of the RBI, where it monitors and regulates commercial banks to ensure they follow rules. This is part of being the "Banker's Bank," not the "Banker to the Government."
Step 3: Final Answer:
Option (D) is a function of the RBI as a regulator/supervisor of the banking system, not as an agent to the government.
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