One of the function of a central bank is that it is "Banker to the government". Which of the following comes under the head?

• Lender of the last resort
• Granting loans and advances to the Cnetre and State Governments
• Advisor to the government
• Agent to the government

2, 3 and 4

The correct answer is option 2: 2, 3 and 4

When we use the term "Banker to the government", it means RBI assist the government in every possible way. The following functions are performed:

1. Carrying out all the banking business of the government
2. Granting loans and advances
3. Managing public debt
4. Acting as the advisor and agent to the government

"Lender of the last resort"➔ This is a separate function related to helping commercial banks in crisis, not specifically related to the government's banking needs.