Question

Name the bank which is known as bankers bank.

Answer 1

In India, Reserve Bank of India is called as bankers bank. RBI acts as a bank for all the commercial banks in India. Hence, called as bankers bank. It holds their cash reserves, lends them short term funds. It also provides them the central clearing and remittances facilities. When the banks face liquidity crisis, RBI helps them in coming out of the situation. Hence it is also known as lender of last resort