6 basic Nature of Central Banking


The basic nature of Central Banking can be enumerated as follows:

1. The Central Bank does not aim at profits but aims at national welfare.

2. The Central Bank does not compete with the member banks.


3. The Central Bank has special relationship with government and with commer­cial banks.

4. The Central Bank is generally free from political influence.

5. The Central Bank is the apex body of the banking structure of the country.

6. The Central Bank should have overall control over the financial system.

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