Which section of the Banking Regulation Act, 1949 explicitly empowers the Reserve Bank of India to issue directions to banking companies in the public interest or to prevent banking affairs from being conducted in a manner detrimental to depositors?

💡 Solution & Explanation

Section 35A of the Banking Regulation Act, 1949 grants the Reserve Bank of India explicit authority to issue directives to banking companies in the public interest or to prevent detrimental management practices. Section 21 specifically empowers the central bank to control advances made by commercial banks. These statutory powers enable the RBI to regulate monetary stability effectively.