Question

92. The Reserve Bank of India (RBI) acts as a bankers’ bank. This would imply which of the following? [2012 - I]

i) Other banks retain their deposits with the RBI.

ii) The RBI lends funds to the commercial banks in times of need.

iii) The RBI advises the commercial banks on monetary matters.

Select the correct answer using the codes given below:

• A. a) ii and iii only
• B. b) i and ii only
• C. c) 1 and iii only
• D. d) i, ii and iii

Answer 1

The correct option is

B i and ii only

RBI is the lender of last resort for commercial banks .Also RBI act as a bank to the commercial banks.