Economics • Banking & FinanceEasy
What is the primary function of the 'National Bank for Agriculture and Rural Development (NABARD)'?
A. To regulate commercial banking operations in metropolitan urban centers.
B. To provide refinance support and developmental credit for agriculture, small-scale industries, and rural development.✓ Correct Answer
C. To manage international trade tariffs and export credit guarantees.
D. To act as the sole custodian of foreign exchange reserves in India.
💡 Solution & Explanation
NABARD was established in 1982 based on the recommendations of the B. Sivaraman Committee to serve as an apex refinancing agency for agricultural credit, small-scale industries, and rural development projects. Unlike commercial banks, it does not engage in direct retail banking for urban retail customers or manage national foreign exchange reserves. It plays a pivotal role in strengthening cooperative banks and regional rural banks across India.
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