The Reserve Bank of India (RBI) recently imposed a monetary penalty on three banks -₹1.50 lakhs on Dr. Ambedkar Nagarik Sahakari Bank Maryadit, ₹25,000 on Nagarik Sahakari Bank Maryadit, and ₹1 lakh on Ravi Commercial bank for violating the provisions of its regulations. The banking regulator has imposed a monetary penalty for contravention of non-compliance with the directions issued to Ravi commercial bank an exposure norms and statutory and other restrictions & KYC.

As a bankers' bank, what is the role played by RBI?

A. Custodian of cash reserves
B. Maintain Foreign Exchange Reserves
C. Currency Issue
D. Lender of last resort
E. Clearing house

Choose the correct answer from the options given below:

A, D and E only

The Reserve Bank of India (RBI) plays the following roles as a bankers' bank:

• A. Custodian of cash reserves: The RBI holds the cash reserves of commercial banks, which is one of the functions of a central bank.

• D. Lender of last resort: In times of financial stress or liquidity crises, the RBI acts as a lender of last resort, providing emergency funds to commercial banks.

• E. Clearinghouse: The RBI facilitates the clearing of checks and other payment instruments among commercial banks.

So, option "A, D, and E only" accurately represents the roles played by the RBI as a bankers' bank.

Options B and C are not directly related to the RBI's role as a banker's bank.

B. Maintain Foreign Exchange Reserves: The RBI does manage India's foreign exchange reserves. However, this function is primarily related to monetary policy and maintaining the stability of the Indian rupee, not directly related to the RBI's role as a banker's bank.

C. Currency Issue: The RBI is responsible for issuing currency notes (Except Re 1 Note) in India. While this function is important for the smooth functioning of the economy, it is not directly related to the RBI's role as a banker's bank.