Central Bank of India: RBI

Central bank of India is RBI. Central bank of India is a regulatory institutional body of India. Reserve Bank of India is a central bank of India under jurisdiction of Ministry of Finance, Government of India. Reserve Bank of India is a solely Government owned body.

History of RBI

After the First World War there was huge crisis in world economy. The community of financial scholars of the world advised to set up a central bank in each country.

That central bank will regulate and monitor the economy of the country through organized banking system in the country. All these central banks of each country will be member of World Bank as well as International Monetary Fund.

Hilton Young commission

Lord Reading was the viceroy who appointed the ‘Hilton Young commission’.

As per History of Banking in India, The Hilton Young Commission was a Commission of Inquiry appointed in 1926 to look into the possible closer of establishment of Central bank of India. The Hilton Young Commission was also called the “royal commission”.

Head of the Hilton Young Commission was Sir Edward Hilton Young. Royal Commission on Indian Currency and Finance (report of Hilton Young Commission) recommends the establishment of a central bank to be called the ‘Reserve Bank of India’.

Central Bank of India

In year 1931, Indian Central Banking Enquiry Committee revives the issue of the establishment of the Reserve Bank of India as the Central Bank for India.

The Central Legislative Assembly passed these guidelines as the Reserve Bank of India Act 1934. RBI establishment was done on 1 April 1935 to respond to economic troubles after the First World War.

The Central Office of the Reserve Bank of India was established in Calcutta (now Kolkata) initially but was moved to Bombay (now Mumbai) in 1937.

There are so many responsibilities and function of RBI.

The Reserve Bank of India also acted as Burma’s (now Myanmar) central bank until April 1947, even though Burma seceded from the Indian Union in 1937.

The Reserve Bank of India as an authority, ceased the function of issuing currency for Burma (Now Myanmar) in year 1942.

The Reserve Bank of India stopped acting as banker to the Government of Burma in year 1947.

After the partition of India in August 1947, the bank served as the central bank for Pakistan until June 1948 when the State Bank of Pakistan commenced operations.

On 1 January 1949, nationalisation of Reserve Bank of India was done. As per Banking Regulation Act 1949 Reserve Bank of India regulates different types of Banks in India.

Reserve Bank of India at a glance:

Frequently Asked QuestionsAnswer
ActRBI Act 1934
Establishment of RBI1 April 1935
CommissionHilton Young Commission (Royal Commission) Year 1926
Head of the Hilton Young CommissionSir Edward Hilton Young
Report of Hilton Young CommissionRoyal Commission on Indian Currency and Finance
First Governor of RBISir Osborne Smith (1 April 1935)
At the time of establishment, authorized capital of RBI was5 crores, The original share capital was divided into shares of 100 each fully paid
OwnerMinistry of Finance, Government of India
HeadquarterKolkata (1935 to 1937)
Then Headquarter shifted toMumbai (Since 1937)
Nationalisation of RBI1 January 1949. The bank was held by private stakeholders before nationalisation.
Only RBI governor who not signed any NoteSir Osborne Smith (1935 to 1937)
When RBI issued Note First time?In January 1938
Second Governor of RBISir James Braid Taylor  (1 July 1937)
Who was the first governor who signed the NoteSir James Braid Taylor 
When RBI’s accounting year was changedOn 11 March 1940, RBI Accounting Year changed from Jan-Dec to July-June.

Now again in year 2020-21 RBI took decision for significant change in the accounting year of the Reserve Bank to April – March (earlier July – June).

Due to this transition, the accounting year 2020-21 was of nine months only, i.e., July 2020 – March 2021. Thereafter, all fiscal year will begin on April 01 every year.

Reference: “Reserve Bank Accounts Annual Reports
Third RBI governor or can say first Indian Governor
Sir C. D. Deshmukh (11 August 1943)
When The security threads on notes were introduced?In year 1944 The security threads on notes were introduced for the first time in India as a security feature.
When first demonetization was done?12 Jan 1946, High Denomination Bank Notes of Rs. 500, Rs.1000, and Rs. 10, 000, Demonetized to curb unaccounted money.
RBI served as central bank for which country except India.RBI served to Pakistan and Burma (Now Myanmar) as the Central Bank of Pakistan and Burma. RBI ceased to function for Pakistan as State Bank of Pakistan commenced operations w.e.f. July 1, 1949. RBI ceased to function as banker to the Government of Burma in year 1947.
When SLR was introduced?Banks have to maintain the Statutory Liquidity Ratio (SLR) for maintaining the liquid assets. The SLR was introduced for the first time On 16 March 1949.
Forth RBI governor or can say Second Indian governorSir Benegal Rama Rau (1 July 1949)
Who was the first woman Dy. Governor? The First woman Deputy Governor of RBI was K J Udeshi.
Name of the Governor who had been the Prime Minister of India.The only Prime Minister who had been the Governor of RBI was Manmohan Singh.
Current RBI Governor isThe current governor of RBI is Shaktikanta Das (Since 12 Dec 2018)
Tenure of RBI Governor 3 year
Member in RBI committee21 Members
Official emblem of RBI isPalm Tree and a Tiger
How many Zonal Offices of RBI are4 Zonal Offices (Mumbai, Kolkata, Delhi and Chennai)
How many Regional Offices of RBI areRBI has nineteen regional offices at: Thiruvananthapuram, Patna, Nagpur, Lucknow, Mumbai, Kochi, Kolkata, Jammu, Kanpur, Chennai, Delhi, Guwahati, Bhubaneshwar, Bhopal, Hyderabad, Ahmedabad, Chandigarh, Jaipur and Bangalore.

RBI Logo has a palm tree and a tiger.
RBI Logo is a Palm Tree and a Tiger.

RBI Management Structure

RBI Management Structure. This flow chart shows the organizational structure of RBI from top Central Board of Directors to bottom support staff.
This flow chart shows the organizational structure of RBI. The Central Board has primary authority for the oversight of RBI. It delegates specific functions through it’s committees, boards and sub-committees.

List of Governors of Reserve Bank of India

RBI GovernorsTime Period since 1935
Sir Osborne SmithApril 1, 1935 – June 30, 1937
Sir James Braid TaylorJuly 1, 1937 – February 17, 1943
Sir C.D. DeshmukhAugust 11, 1943 – June 30, 1949
Sir Bengal Rama RauJuly 1, 1949 – January 14, 1957
K.G. AmbegaonkarJanuary 14, 1957 – February 28, 1957
H.V.R LyengarMarch 1, 1957 – February 28, 1962
P.C BhattacharyaMarch 1, 1962 – June 30, 1967
L.K. JhaJuly 1, 1967 – May 3, 1970
B.N. AdarkarMay 4, 1970 – June 15, 1970
S. JagannathanJune 16, 1970 – May 19, 1975
N.C. Sen GuptaMay 19, 1975 – August 19, 1975
K.R. PuriAugust 20, 1975 – May 2, 1977
M. NarasimhamMay 3, 1977 – November 30, 1977
I.G. PatelDecember 1, 1977 – September 15, 1982
Manmohan SinghSeptember 16, 1982 – January 14, 1985
Amitav GoshJanuary 15, 1985 – February 4, 1985
R.N. MalhotraFebruary 4, 1985 – December 22, 1990
S. VpnldraramananDecember 22, 1990 – December 21, 1992
C. RangarajanDecember 22, 1992 – November 21, 1997
Bimal JalanNovember 22, 1997 – September 6, 2003
Y.V. ReddySeptember 6, 2003 – September 5, 2008
D. SubbaraoSeptember 5, 2008 – September 4, 2013
Raghuram G. Raj anSeptember 4, 2013 – September 4, 2016
Urjit Ravindra PatelSeptember 4, 2016 – December 10,2018
Shaktikanta DasDecember 12, 2018 – to date

Central Office Departments

RBI’s central office is located at Mumbai and it has twenty-seven departments.

The Central Board has primary authority for the oversight of RBI. It delegates specific functions through it’s committees, boards and sub-committees.

These departments frame policies in their respective work areas. They are headed by senior officers in the rank of Chief General Manager.

(1) Markets

  • Department of External Investments and Operations
  • Financial Markets Department
  • Financial Stability Unit
  • Internal Debt Management Department
  • Monetary Policy Department

(2) Regulation and Supervision

  • Department of Banking Operations and Development
  • Department of Banking Supervision
  • Department of Non-Banking Supervision
  • Foreign Exchange Department
  • Rural Planning and Credit Department
  • Urban Banks Department

(3) Research

  • Department of Economic Analysis and Policy
  • Department of Statistics and Information Management

(4) Services

  • Customer Service Department
  • Department of Currency Management
  • Department of Government and Bank Accounts
  • Department of Payment and Settlement Systems

(5) Support

  • Department of Administration and Personnel Management
  • Department of Communication
  • Department of Expenditure and Budgetary Control
  • Department of Information Technology
  • Human Resources Development Department
  • Inspection Department
  • Legal Department
  • Premises Department
  • Rajbhasha Department
  • Secretary’s Department

Reference: “List of RBI Governors” rbi.org.in