Monetary system is developed along side with development of Money. Perhaps credit creation and Maintaing the same is the one core essential element of the whole economic system of any country. The whole business Transaction system and monetary system perhaps works around it. Regulation of credit (i.e. its creation and maintenance) is probably the main function of central Bank (in case of India it is RBI). Through the Central Economic policy (which Includes Monetary and Fiscal Policy) through which central banks control the entire economy and fulfills three broad aspect and purposes which are Economic, Price and exchange stabilization.

KEYWORDS: Monetary System, Central Bank, Credit Control, Credit Creation and Maintenance.