(a) Which institution supervises the functioning of formal sources of credit in India?

money-and-credit

#1

(a) Which institution supervises the functioning of formal sources of credit in India?
(b) How does it supervise them? State any two points.


#2

(a) The Reserve Bank of India (Reserve Bank of India) supervises the functioning of formal sources of credit in India.
(b) This is done by the following methods
(i) Commercial Banks are required to hold part of their cash reserves with the Reserve Bank of India, besides maintaining a minimum cash balance out of the deposits they receive.
(ii) Commercial Banks have to submit the lending information details to the Reserve Bank of India to ensure that the banks give loans to all kinds of customers.