1926: Royal Commission on Indian Currency suggests creation of a central bank named the Reserve Bank of India (RBI)
1934: The
Reserve Bank of India Act is passed to constitute RBI
DECADE 1: THE JOURNEY BEGINS (1935 - 1944):
1935: On April 1, RBI starts operations as a shareholders' bank; Osborne Smith is appointed the first governor
1938: First RBI notes issued
1940: RBI's accounting year changed to July-June; silver rupee replaced by quarternary alloy rupee
1943: C D Deshmukh becomes first Indian governor
1944: Security thread on notes introduced for the first time
DECADE 2: THE EARLY YEARS (1945 - 1954):
1946: Ordinances introduced to empower RBI to inspect banks and authorise licensing of branches
1948: RBI ceases to function as Pakistan's central bank; State Bank of Pakistan starts operations a year later
1949: RBI nationalised on January 1; Banking Companies Act comes into force two months later
1950: Department of banking development created, with post of executive director
1952: Bill Market Scheme introduced to enable banks to obtain advances from RBI against self-liquidating bills
DECADE 3: BUILDING INSTITUTIONS (1955 - 1964):
1956: Selective credit controls deployed for first time
1960: Deposit insurance introduced, following the collapse of a couple of banks
1960: Banking sector consolidation starts; between 1960 and 1982, about 200 banks were merged
1962: Banking Regulation Act amended
1964: RBI empowered to regulate deposit acceptance activities of non-banking institutions
DECADE 4: THE ERA OF NATIONALISATION OF BANKS (1965 - 1974):
1965: Credit regulation introduced to align the growth of bank credit with plan requirements
1966: Cooperative banks' operations brought under RBI; rupee devalued by 36.5% on June 6
1967: Size of bank notes reduced
1968: Quarternary alloy rupee coins demonetised; Gold (Control) Act passed
1969: Fourteen scheduled commercial banks with deposits of over Rs 50 crore nationalised
1970: RBI sets minimum interest rate to be charged on advances against sensitive commodities; inflationary trends lead to measures, including increasing of bank rate and SLR
1972: Differential interest rate scheme introduced
1974: Foreign Exchange Regulation Act comes into force to conserve foreign exchange
DECADE 5: THE PERIOD OF EXPANSION OF BANKING BUSINESS (1975 - 1984):
1977: A new series of money supply introduces the concepts of M1, M2, M3, etc
1978: RBI commences gold auctions on behalf of govt; annual appraisal of banks started
1979: Penalty for non-compliance of CRR and SLR introduced
1980: International gold prices soar to all-time highs; six private sector banks nationalised
1982: National Bank for Agriculture and Rural Development established
DECADE 6: THE PERIOD OF ECONOMIC LIBERALISATION (1985 - 1994):
1986: BIFR set up, reflecting concerns over industrial sickness. MICR technology introduced for cheque clearing
1988: Maximum lending rate abolished, allowing banks to charge customers according to their credit record
1989: Certificates of deposits and commercial papers introduced to widen monetary instruments
1990: Agriculture and rural debt relief scheme providing debt relief to up to 10,000 small borrowers announced
1991: External payments crisis; rupee devalued in two stages
1992: Income recognition and asset classification norms introduced
1993: Guidelines for licensing of new banks from private sector introduced
1994: Nationalised banks allowed to tap capital market; lending rates of commercial banks de-regularised; rupee made convertible on current account
DECADE 7: THE ERA OF CRISIS AND REFORMS (1995 - 2004):
1995: Banks allowed to fix their own interest rates on domestic term deposits with maturity of two years
1996: RBI website becomes operational
1997: RBI conducts first auction of 14-day treasury bills; FIIs permitted to invest in dated government securities
1999: Interim liquidity adjustment facility introduced; interest rate swaps and forward rate agreements introduced as OTC derivatives; Foreign Exchange Management Act replaces Foreign Exchange Regulation Act
2000: Stock Index Futures introduced as an exchange traded derivative
2001: Kisan Credit Cards introduced; Clearing Corporation of India established; guidelines on internet banking issued
2003: Risk-based supervision of banks introduced; two new banking licences given
DECADE 8: CONSOLIDATING THE GAINS AND TACKLING INFLATION (2005 - 2015):
2008: Global financial crisis starts with collapse of Lehman Brothers
2009: Rupee starts depreciating against $
2010: Inflation starts rising, prompting RBI to increase rate; base rate was introduced as minimum lending rate
2010: Crisis begins in microfinance sector; government promises to offer new banking licences
2011: Savings deposit rate deregulated
2013: RBI releases guidelines on subsidiarisation of foreign banks in India
2014: RBI offers banking licences to Bandhan and IDFC; guidelines for licensing of niche banks released
2015: In January, RBI cuts interest rate for the first time since May 2013, indicating the war against inflation is over, at least for the time being; central bank signs agreement with government to have the mandate of exclusive inflation targeting
Source: Reserve Bank of India
