It was initially known as the Central Bank of Vanuatu after the nation's independence from France and the United Kingdom.

[citation needed] It established the Vatu as the national currency to replace the circulation of the New Hebrides franc and Australian dollar.

[citation needed] The functions, powers and responsibilities of the RBV are specified in the Reserve Bank of Vanuatu Act [CAP 125] of 1980.

The specific purposes of the RBV as spelled out in Section 3 of the Reserve Bank Act are to: Regulate the issue, supply, availability and international exchange of money; Supervise and regulate banking business and the extension of credit; Advise the Government on banking and monetary matters; Promote monetary stability; Promote a sound financial structure; Foster financial conditions conducive to the orderly and balanced economic development of Vanuatu, and To regulate and supervise domestic and international (offshore) banks.

[2] Appointments to the Board of Directors of the RBV are governed by Section 8 of the Reserve Bank Act.