The Reserve Bank of India was established on April 1, 1935 in accordance with the provisions of the Reserve Bank of India Act, 1934.
The Central Office of the Reserve Bank was initially established in Calcutta but was permanently moved to Mumbai in 1937. The Central Office is where the Governor sits and where policies are formulated.
Though originally privately owned, since nationalisation in 1949, the Reserve Bank is fully owned by the Government of India.
The Preamble of the Reserve Bank of India describes the basic functions of the Reserve Bank as:
"…to regulate the issue of Bank Notes and keeping of reserves with a view to securing monetary stability in India and generally to operate the currency and credit system of the country to its advantage."
The general superintendence and direction of the RBI is entrusted with the 21-member Central Board of Directors: the Governor, 4 Deputy Governors, 2 Finance Ministry representatives, 10 government-nominated directors to represent important elements from India's economy, and 4 directors to represent local boards headquartered at Mumbai, Kolkata, Chennai and New Delhi. Each of these local boards consists of 5 members who represent regional interests, and the interests of co-operative and indigenous banks.
The bank issues and exchanges currency notes and coins and destroys the same when they are not fit for circulation.
The Governor of the Reserve Bank of India (RBI) is the chief executive of India's central bank and the ex-officio chairperson of its Central Board of Directors. Indian Rupee currency notes, issued by the RBI, bear the governor's signature.
The position is currently held by Raghuram Rajan, who took over from D. Subbarao on 4 September 2013. He is set to be replaced by Urjit Patel on 4 September 2016.
Urjit R. Patel (born 28 October 1963) is an Indian economist, consultant and banker, currently serving as Deputy Governor of the Reserve Bank of India (RBI).