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Question
Distinguish between.
Central Bank and Commercial Bank
Solution
| Central Bank | Commercial Bank |
| 1. Function: The main function of the central bank is to regulate the money supply in the country. |
The main function is to accept deposits from the public and lend it to industry and others. |
| 2. Printing of Currency: The central bank can print currency notes. |
Commercial banks cannot print currency |
| 3. Acceptance of Deposits: The central bank does not accept deposits from the public. |
Commercial banks accept deposits from the public. |
| 4. Loans The central bank provides loans to bankers and financial institutions. |
Commercial banks provide loans to industry and commerce. |
| 5. Ownership: It is owned and controlled by the government of India. |
It can be owned by private and/or government agencies. |
| 6. Number of Banks: There is only one Central Bank (RBI) in India. |
There are many commercial banks in India. |
| 7. Monetary policy The Central Bank frames the monetary and credit policy. |
Commercial banks do not frame any monetary policy |
|
8. Control The central bank keeps a check on commercial banks. |
Commercial banks do not keep a check on the central bank. |
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