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Credit Control Policy of Rbi

The document discusses the credit control policy of the Reserve Bank of India (RBI). It outlines the need for credit control, which includes encouraging priority sectors for growth and ensuring inflation is kept in check. It also describes the two main types of credit control methods used by RBI - quantitative methods, which control the money supply through tools like bank rates, open market operations, and cash reserve ratios, and qualitative methods, which involve credit rationing, regulating consumer credit, and moral suasion.

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Soumya Dhir
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1K views6 pages

Credit Control Policy of Rbi

The document discusses the credit control policy of the Reserve Bank of India (RBI). It outlines the need for credit control, which includes encouraging priority sectors for growth and ensuring inflation is kept in check. It also describes the two main types of credit control methods used by RBI - quantitative methods, which control the money supply through tools like bank rates, open market operations, and cash reserve ratios, and qualitative methods, which involve credit rationing, regulating consumer credit, and moral suasion.

Uploaded by

Soumya Dhir
Copyright
© Attribution Non-Commercial (BY-NC)
We take content rights seriously. If you suspect this is your content, claim it here.
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Download as PPT, PDF, TXT or read online on Scribd
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CREDIT CONTROL POLICY OF RBI

PRESENTED BY:
SATYARANJAN PANDIA

PGDM 1ST YR INSTITUTE OF MANAGEMENT BHUBANESWAR

Credit Control of RBI


Need: 1.To encourage the priority sectors for overall growth 2.Fecilitate the flow of adequate volume of bank credit to its industry, agriculture and trade 3.To keep Inflation pressure under check 4.To ensure that Credit is not diverted to undesirable purposes 5.To fecilitate the Development of Indian economic growth

Types of credit control :


Quantitative Method Qualitative Method

Quantitative Method
1.Bank rate policy: by controlling the ways and means advances to the govt. 2.Open Market operation: by controling Short term liquidity in the market. 3.variation of cash reserve ratio: by increasing or reducing CRR or SLR. 4.fixation of lending rate: control by Increasing or reducing the rate of primary or secondary lending rates 5.Credit sequeenze: by controlling the amount of bank credit at a certain limit and fixing maximum limit for commercial borrowings.

Qualitative Method
1.Fixation of Margin Requirement 2.Regulation of consumer credit 3.Rationing of credit 4.Prior authorisation of schemes 5.Moral sausion 6.Direct Action

references
http://www.indianofficer.com/forums/indian -economy/1551-credit-control-rbi.html www.wiki.com

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