(i) Bank of issue
(ii) Governments bank
(iii) Bankers Bank
(iv) Controller of credit
Detailed Answer:
The principal functions of the Central Bank are as follows:
(i) Issuing of Notes or Currency Authority-The Central Bank is the sole note issuing authority in the country. Large number of Central Banks have divided their functions into two parts - Banking department and issue department. It is the issue department that is responsible for issuing note.
(ii) Banker to the Government-Central Bank acts as a banker, agent and financial advisor to the government. It keeps the accounts of all government banks and manages government treasuries. The loans are given to the government without any interest for short-terms. It also transfers government funds. It also buys and sells securities, treasury bills on behalf of the government. Being the apex bank of the country, it advises the government from time to time on economic, financial and monetary matters.
