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Cash Reserve Ratio or CRR in India is the amount of money that every bank has to deposit with the RBI per customer. Every time a customer deposits cash to the bank, the bank has to correspondingly deposit a portion of that cash to the RBI. RBI decides this percentage of money that each bank has to deposit with it. The RBI holds the control on the CRR because, the CRR can influence the credit conditions in our country. If the CRR is increased, the amount of liquid cash in circulation in the country would come down and similarly if the CRR is decreased, the cash circulation in the country would increase.
Say if the CRR of the country is 10%, and you go to a bank to deposit Rs. 1000/- the bank will have to deposit at least Rs. 100/- with RBI. The remaining funds can be used by the bank to grant loans to other customers and earn an income for itself
What else can I help you with?
Formula for calculating cash debosit ratio?
cash reserve ratio
What is current cash reserve ratio?
The current cash reserve ratio (CRR) in India set by the RBI is 5% as on 21st august, 2009.
What is the current Cash Reserve Ratio in India?
7%
What is the current cash reserve ratio in Pakistan?
5%
Where can one find information on a cash reserve ratio?
You can find information on a cash reserve ratio when you go to the websites of BanKingawareness, mrunal, AllBankingSolutions, as well as wikinvest, etc.
What is current cash reserve ratio in 2011?
the current CRR ratio of 2011 is 6%.
What country was introduced the cash reserve ratio?
Canada India
What are the types of liquidity ratios?
1) Statutory Liquid Ratio 2) Cash Reserve Ratio
What is ment by CRR?
CRR MEANS CASH RESERVE RATIO IS A DECLINE IN THE LIQUIDITY OF A ECONOMY THIS IS CREDIT RESERVE RATION IN WHICH A COMMERCIAL BANK HAVE MAINTAIN A PERCANGE OF BALANCE WITH RBI CRR MEANS CASH RESERVE RATIO IS A DECLINE IN THE LIQUIDITY OF A ECONOMY
What do you meant by Crr in banking terms?
CRR means Cash Reserve Ratio.
Which of the rates decided by the RBI is called Policy Rate?
Cash Reserve ratio
Are banks permitted to lend all their reserves?
No. They can lend only a % of their total cash reserves. It depends on the Cash Reserve Ratio and Liquidity Ratios set by the Central Banks (Reserve Bank, Federal Reserve etc)
