Journey of RBI

Key Landmarks in the Journey of RBI

  • In 1926, the Royal Commission on Indian Currency and Finance recommended creation of a central bank for India.
  • In 1927, a bill to give effect to the above recommendation was introduced in the Legislative Assembly, but was later withdrawn due to lack of agreement among various sections of people.
  • In 1933, the White Paper on Indian Constitutional Reforms recommended the creation of a Reserve Bank. A fresh bill was introduced in the Legislative Assembly.
  • In 1934, the Bill was passed and received the Governor General’s assent
  • In 1935, Reserve Bank commenced operations as India’s central bank on April 1 as a private shareholders’ bank with a paid up capital of rupees five crore.
  • In 1942 Reserve Bank ceased to be the currency issuing authority of Burma (now Myanmar).
  • In 1947, Reserve Bank stopped acting as banker to the Government of Burma.
  • In 1948, Reserve Bank stopped rendering central banking services to Pakistan.
  • In 1949, the Government of India nationalized the Reserve Bank under the Reserve Bank (Transfer of Public Ownership) Act, 1948.
  • In 1949, Banking Regulation Act was enacted.
  • In 1951, India embarked in the Planning Era.
  • In 1966, the Cooperative Banks came within the regulations of the RBI.
  • In 1966, Rupee was devaluated for the first time.
  • In 1969, Nationalization of 14 Banks was a Turning point in the history of Indian Banking.
  • In 1973, the Foreign Exchange Regulation act was amended and exchange control was strengthened.
  • In 1974, the Priority Sector Advance Targets started getting fixed.
  • In 1975, Regional Rural Banks started
  • In 1985, the Sukhamoy Chakravarty and Vaghul Committee reports embarked the era of Financial Market Reforms in India.
  • In 1991, India came under the Balance of Payment crisis and RBI pledged Gold to shore up reserves. Rupee was devaluated.
  • In 1991-92, Economic Reforms started in India.
  • In 1993, Exchange Rate became Market determined.
  • In 1994, Board for Financial Supervision was set up.
  • In 1997, the regulation of the Non Banking Financial Companies (NBFC) got strengthened.
  • In 1998, Multiple Indicator Approach for monetary policy was adopted for the first time.
  • In 2000, the Foreign Exchange Management Act (FEMA) replaced the erstwhile FERA.
  • In 2002, The Clearing Corporation of India Ltd Started operation.
  • In 2003, Fiscal Responsibility and Budget Management Act (FRBMA) enacted.
  • In 2004, Liquidity Adjustment Facility (LAF) started working fully.
  • In 2004, Market Stabilization Scheme (MSS) was launched.
  • In 2004 Real Time Gross Settlement (RTGS) started working.
  • In 2006, Reserve Bank of India was empowered to regulate the money, forex, G-Sec and Gold related security markets.
  • In 2007, Reserve bank of India was empowered to regulate the Payment systems.
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