Subsidiaries — Set 5

Correct Answer: D. DICGC

• **DICGC** = Deposit Insurance and Credit Guarantee Corporation is a wholly owned subsidiary of the RBI, meaning 100% of its equity is held by the Reserve Bank, making it legally and financially subordinate to the central bank. • **Established 1978** — DICGC was formed in 1978 by merging the Deposit Insurance Corporation (est. 1962) and the Credit Guarantee Corporation of India (est. 1971); it operates under the DICGC Act, 1961. • The other four wholly owned RBI subsidiaries are BRBNMPL, ReBIT, IFTAS, and RBIH — a total of five in all. • 💡 Option A (EXIM Bank) is wrong because EXIM Bank is owned by the Government of India under the Export-Import Bank of India Act, 1981; Option B (SIDBI) is wrong because SIDBI is majority-owned by the GoI and various public financial institutions; Option C (NABARD) is wrong because NABARD was carved out of the RBI in 1982 and is now majority-owned by the Government of India.

Correct Answer: C. 5

• **5** = The RBI currently has five wholly owned subsidiaries: DICGC (deposit insurance), BRBNMPL (currency printing), ReBIT (IT and cybersecurity), IFTAS (financial-technology infrastructure), and RBIH (financial innovation). • **NHB departed in 2019** — The count was reduced from six to five when the Government of India took over 100% ownership of National Housing Bank (NHB) from the RBI in 2019 as part of a policy to separate regulator from regulated entity. • Each of the five subsidiaries serves a distinct operational domain, collectively supporting the RBI's core functions of monetary management, financial stability, and payment-system oversight. • 💡 Option A (6) is wrong because NHB, formerly the sixth subsidiary, was transferred to GoI ownership in 2019; Option B (3) is wrong because only three subsidiaries would exclude ReBIT and RBIH, both active wholly owned entities; Option D (4) is wrong because all five — DICGC, BRBNMPL, ReBIT, IFTAS, and RBIH — are currently operational subsidiaries.

Correct Answer: A. Printing Banknotes

• **Printing Banknotes** = BRBNMPL's primary mandate is the production of Indian currency banknotes — it plans, manufactures, and supplies notes to the RBI, incorporating complex security features to deter counterfeiting. • **Established 1995** — BRBNMPL was incorporated in 1995 as a private limited company wholly owned by the RBI, specifically to augment note-printing capacity beyond the government-owned Nashik and Dewas presses operated by SPMCIL. • BRBNMPL operates presses in Mysuru (Karnataka) and Salboni (West Bengal), and its Mysuru campus also houses the Varnika ink-manufacturing unit for security-ink self-sufficiency. • 💡 Option B (Insuring Deposits) is wrong because deposit insurance is the exclusive mandate of DICGC, a separate RBI subsidiary; Option C (Settling Trades) is wrong because trade and securities settlement is handled by clearing corporations such as CCIL, not BRBNMPL; Option D (Regulating Banks) is wrong because bank regulation is a direct RBI function carried out by its internal departments, not delegated to BRBNMPL.

Correct Answer: C. DICGC

• **DICGC** = Deposit Insurance and Credit Guarantee Corporation is the statutory body and wholly owned RBI subsidiary that insures bank deposits, guaranteeing repayment of up to ₹5 lakh per depositor per bank if the bank fails. • **DICGC Act, 1961** — DICGC derives its powers from the DICGC Act, 1961; every eligible bank — including commercial banks, cooperative banks, RRBs, SFBs, and payments banks — is mandatorily registered with DICGC and pays a half-yearly premium to fund the insurance pool. • DICGC is one of the RBI's oldest subsidiaries, with roots in the original Deposit Insurance Corporation formed in 1962. • 💡 Option A (IFTAS) is wrong because IFTAS manages financial-technology infrastructure like INFINET and SFMS, with no deposit-insurance role; Option B (ReBIT) is wrong because ReBIT is an IT and cybersecurity services company, not an insurance entity; Option D (BRBNMPL) is wrong because BRBNMPL prints currency and has no connection to financial guarantees or insurance.

Correct Answer: A. ReBIT

• **ReBIT** = Reserve Bank Information Technology Private Limited (ReBIT) is the RBI's dedicated technology subsidiary, providing IT infrastructure management, application development, cybersecurity monitoring, and shared IT services exclusively to the central bank and its regulated entities. • **Incorporated February 2016** — ReBIT was set up in February 2016 as a wholly owned subsidiary to give the RBI a captive technology capability, reducing reliance on third-party IT vendors for critical banking-system infrastructure. • Beyond internal IT services, ReBIT conducts IT examinations and vulnerability assessments of commercial banks on behalf of the RBI, and its findings feed into sector-wide cybersecurity guidelines. • 💡 Option B (BRBNMPL) is wrong because BRBNMPL's work is physical — printing currency notes — and it has no cybersecurity mandate; Option C (DICGC) is wrong because DICGC's sole domain is deposit insurance, not technology services; Option D (NHB) is wrong because NHB regulates housing-finance companies and has been under GoI ownership since 2019, with no IT-services role for the RBI.

Correct Answer: D. Financial technology services

• **Financial technology services** = IFTAS is dedicated to delivering high-end financial-technology services to the RBI and the broader banking sector, primarily by managing critical network and messaging infrastructure. • **INFINET and SFMS** — IFTAS operates INFINET (Indian Financial Network), the closed-user-group leased-line network connecting all banks and the RBI, and SFMS (Structured Financial Messaging Solution), the messaging protocol used for RTGS and NEFT transactions; these are among India's most critical financial-market infrastructures. • IFTAS was carved out of the RBI's internal IT division to give this infrastructure a dedicated corporate entity capable of entering contracts, hiring specialists, and scaling operations independently. • 💡 Option A (Note printing) is wrong because note printing is BRBNMPL's exclusive function; Option B (Housing finance) is wrong because housing finance is regulated by NHB, which is no longer an RBI subsidiary; Option C (Deposit insurance) is wrong because deposit insurance is the exclusive mandate of DICGC.

Correct Answer: D. ₹5 Lakh

• **₹5 Lakh** = DICGC insures each depositor for a maximum of ₹5 lakh per bank, covering combined principal plus interest across all accounts held in the same name and legal capacity within that bank. • **Revised in February 2020** — The ceiling was enhanced from ₹1 lakh to ₹5 lakh by amending the DICGC Act, 1961 in February 2020, announced in the Union Budget 2020-21; it was the first upward revision in 27 years. • The ₹5 lakh limit applies separately per bank — so a depositor holding accounts in three different banks gets up to ₹15 lakh total protection across all three institutions. • 💡 Option A (₹10 Lakh) is wrong because ₹10 lakh has never been the DICGC statutory ceiling; Option B (₹2 Lakh) is wrong because ₹2 lakh was not a mandated DICGC threshold at any point in its history; Option C (₹1 Lakh) is wrong because ₹1 lakh was the pre-2020 ceiling and is now superseded.

Correct Answer: A. RBIH

• **RBIH** = Reserve Bank Innovation Hub is the newest RBI subsidiary, created to catalyse financial innovation in India by developing, testing, and scaling technology-based solutions that deepen financial inclusion and improve access to credit. • **Incorporated 2022** — RBIH was incorporated in 2022 as a Section 8 (not-for-profit) company with a ₹100 crore initial corpus funded by the RBI; its signature project is the Public Tech Platform for Frictionless Credit (PTPFC), piloted in August 2023. • RBIH collaborates with start-ups, academia, and fintech firms through hackathons, regulatory sandboxes, and co-development programmes, serving as the innovation bridge between the regulator and the fintech ecosystem. • 💡 Option B (ReBIT) is wrong because ReBIT was incorporated earlier, in 2016, and focuses on IT and cybersecurity services rather than financial-sector innovation; Option C (IFTAS) is wrong because IFTAS was established to manage INFINET and SFMS infrastructure, not to drive innovation; Option D (DICGC) is wrong because DICGC was established in 1978 with a deposit-insurance mandate, entirely unrelated to innovation promotion.

Correct Answer: D. NHB

• **NHB** = National Housing Bank was originally set up in 1988 as a wholly owned subsidiary of the RBI under the National Housing Bank Act, 1987, to serve as the apex institution for housing finance; in 2019, the Government of India acquired 100% of NHB's shareholding from the RBI. • **2019 transfer rationale** — The transfer was driven by the principle that the RBI should not simultaneously regulate housing-finance companies (HFCs) and own the apex institution that regulates them — a conflict of interest resolved by moving NHB to GoI ownership. • After the transfer, NHB continues to regulate HFCs and refinance housing loans but is now accountable to the Ministry of Finance rather than the RBI. • 💡 Option A (ReBIT) is wrong because ReBIT was incorporated in 2016 and remains an active wholly owned RBI subsidiary; Option B (IFTAS) is wrong because IFTAS continues to operate as a wholly owned RBI subsidiary managing INFINET; Option C (BRBNMPL) is wrong because BRBNMPL, incorporated in 1995, remains a fully owned RBI subsidiary running the Mysuru and Salboni currency presses.

Correct Answer: D. Mysuru and Salboni

• **Mysuru and Salboni** = BRBNMPL operates two currency note-printing presses — one in Mysuru (Karnataka) and one in Salboni (West Bengal) — both fully owned and managed by the RBI through its printing subsidiary. • **Government presses are separate** — The Nashik (Maharashtra) and Dewas (Madhya Pradesh) currency presses belong to SPMCIL, a Government of India enterprise under the Ministry of Finance; they are entirely distinct from BRBNMPL's presses. • The Mysuru press campus also houses Varnika, BRBNMPL's security-ink manufacturing facility, making it a self-contained note-production complex. • 💡 Option A (Hyderabad and Noida) is wrong because neither city hosts a BRBNMPL currency press; Option B (Nashik and Dewas) is wrong because those presses are government-owned through SPMCIL, not BRBNMPL's; Option C (Mumbai and Kolkata) is wrong because neither city has an active BRBNMPL printing facility — BRBNMPL's currency printing is concentrated at Mysuru and Salboni.