Explain the difficulties of credit control. (2024)

In spite of adopting various measures central bank not control the credit in fully desired way. Central bank may face many difficulties while going for credit control which are as follows :-1 Credit other than Bank credit :- Central bank can only control bank credit not other credit like exchange bills promissory notes etc.2 Lack of control in all Bank :- Central bank has no direct control in all banking institutions in the country. Central bank does nothave that much control in foreign banks as it has on domestic banks.3 Lack of control on ultimate use of Credit :- Central bank cannot put a control in the ultimate use of credit. People may use the credit for speculation while it is taken for productive business activity.4 Lack of control in Non-monetary Factors :- Economic fluctuations appear due to both monetary and non-monetary factors. Central bank can control only monetary factors with its policies.