The RBI drives the powers to issue directions to banking companies through provisions of Banking Regulation Act, 1949. The Section 21, 35A and 36 of BR Act confers powers of RBI to issue directions to banking companies.
The Section 21 of Act allows RBI to control loans and advances extended by banking companies. RBI may issue directions in respect of following items to banking companies and every banking company has to necessarily comply with its directions:
Section 35A of the Banking Regulation Act, 1949 vests power in the RBI to give directions to banks and can take action:
Under Section 36 of Banking Regulation Act, the RBI is empowered to caution or prohibit any banking company regarding any transaction or class of actions.
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Tags: power of rbi to issue directions, section 21 of br act, section 21 of banking regulation act, section 35A of banking regulation act, section 36 of banking regulation act
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