How does RBI earn so much money?

Описание: “How does RBI earn so much money Bro?”

I overheard a conversation while at lunch.

RBI declared a record dividend of Rs.2.69 lakh crore.

There are 5 primary ways in which RBI earns money.

Let me make it clear, RBI’s primary role is to keep the economy stable. But it does earn money, a lot of money in the process.

1. Interest Income from Government Securities

The RBI holds a large portfolio of government securities. A good chunk of its income comes from the interest earned on government bonds and treasury bills.

2. Forex Reserves Management

The RBI holds foreign exchange reserves like dollar, euros, yen, gold and few other currency. These generate capital gains or interest from the asset. For example the gold reserve it holds has gone up in value recently due to super surge in gold price.

3. Trading Income

To keep a check on volatility RBI buys and sells government securities in the open market. Thus it trading income, sometimes this can be very high.

4. Income from other banks

RBI offers services to all banks related to clearing and debt management. It charges & collects fees for the banking services it provides. This is a steady income.

5. Printing money

RBI’s cost of printing a Rs.2000 note will be a few rupees, but sells at multiple times. This is the seigniorage it earns. Seigniorage is the difference between the cost of printing currency and its face value.

The FY 26 Budget expected 13,000 cr lesser dividend. This is great news for the Government finances and also for Long Term Debt Investments.