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In what ways does the Central Bank act as a banker to the government?

Give ways in which Central Bank acts as a banker to the government.

Answers

Maurice
(i) Undertakes all Government transactions as different ministries draw their cheques on its payment for goods and services that the ministries purchase/ make payment for goods and services on behalf of the government.

(ii) Advances loans to the Government both on short-term and long-term basis to finance different projects.

(iii) Repays foreign loans on behalf of the government hence keeps reserves of foreign exchange for such loans.

(iv) Receives various revenues on behalf of the government in form of taxes and foreign loans.

(v) Safeguards public revenue on behalf of the government.
maurice.mutuku answered the question on July 17, 2017 at 05:24

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