Functions of central bank

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The functions of central bank are following. Note issuing. It has the authority to issue the notes and currency of a country. Maintaining money circulation: It controls the circulation of money in a country. It has increase or decreases the interest rates.


Discount the bill. It provides the facility of rediscounting the bill of exchange. Government bank. It works as a Government bank. Pay fee to foreign bodies. It pays fee to World Bank IMF as a member. Lender of last resort: It is the lender of last resort because the commercial banks can get loans from it. Controller: It controls all the commercial banks. Implement rules and regulations. Trade: It helps in encourage imports and exports.


Clearing house: It serves as a clearinghouse for all banks. Advices: It gave advices to the Government about financial issues. Reserve: It maintain the reserve of commercial banks. Save metal. It helps in save metal by holding gold against issuance of currency.


Accounts: It has Government accounts in it. Training: It provides training to employees to work efficiently in banks. Independent: It is an independent bank and takes their decisions independently. Foreign currency: It maintains the flow of foreign currency.

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