objective of credit control साख का नियन्त्रण

Objective of Credit Control साख का नियन्त्रण

Bank is an important part of our economic and the entire bank always prefer to earn profit. For this, banks accept saving or different deposit on a fix interest rate from the public side and give loan to create credit on other side. Give a loan or create credit is an important part of any bank. But if flow of money increase in the market then price level increase automatically then we face an inflation in the economic. So it’s become the responsibility of the Central bank to control the flow of money and avoid inflation or deflation situation.

objective of credit control साख का नियन्त्रण

Motive or objectives of credit control (साख नियन्त्रण) –

ü Control the domestic price level – one of the important points is to control the domestic price level and also avoid the inflation or deflation situation. These things influence our economic growth.

  

ü Manage different Business Cycles – when there is a positive environment, we increase our jobs, productivity or price level etc and vise-versa also in negative environment. Central bank adopts such a policy in positive environment, we control the credit to avoid the inflation or in negative environment, we adopt a positive policy to spread the credit creation with liberal policy for investment, to create jobs or motivate the economic.

  

ü Manage foreign exchange – if there is a continue change in the domestic price level, these things effect our export & import. Any increase in price level our export decrease and import increase, this situation decrease the value or demand of our currency and vise versa also.

ü Balance the Growth & Stability – every economic have a dream that Growth with Stability. In the condition, there is a full employment, there is no pressure of fiscal or inflation sides. Stable price and foreign exchange is also an important.

ü Fulfill business requirement – central bank play an important role to fulfill the business requirement. Our traders or industries require credit or fund to meet their goal and then we require more funds for more growth or expand our business. These things also help the central bank to avoid or control the deficit in foreign trade also.