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    Question

    Which of the following is a qualitative control measure

    of credit control by RBI?
    A Bank rate Correct Answer Incorrect Answer
    B Cash reserve ratio Correct Answer Incorrect Answer
    C Credit rationing Correct Answer Incorrect Answer
    D Open market operations Correct Answer Incorrect Answer

    Solution

    Bank rate, CRR, OMO and SLR are the quantitative measures of credit control used by RBI. While qualitative measures include margin requirements, consumer credit regulations, credit rationing, moral suasion or direct action. Credit rationing refers to measure undertaken by the central bank to limit or deny the supply of credit based on the investor’s creditworthiness and an increased loan demand.

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