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Question
Which of the following phrases best describes banks being told to uphold their moral responsibilities?
Which of the following phrases best describes banks being told to uphold their moral responsibilities?
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Solution
The correct option is A Moral suasion
The Reserve Bank of India regulates banks to follow their moral responsibilities like persuading banks to advance or reduce credit to certain activities. This practice is called moral suasion. Thus, the RBI sends circulars and letters to banks to uphold ethical banking practices.
The Reserve Bank of India regulates banks to follow their moral responsibilities like persuading banks to advance or reduce credit to certain activities. This practice is called moral suasion. Thus, the RBI sends circulars and letters to banks to uphold ethical banking practices.
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