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RBI raises daily CRR maintenance requirement from 90% to 99%
వార్తల్లో ఎందుకు?
99% of CRR, not 90%: the daily maintenance rule every GS-III monetary policy answer must separate
The Reserve Bank of India raised the minimum daily Cash Reserve Ratio (CRR) maintenance requirement for scheduled banks from 90% to 99% of the prescribed CRR, effective 16 October 2026.
Why it matters: general awareness
What you need to know
2 నిమి
The Reserve Bank of India raised the minimum daily Cash Reserve Ratio (CRR) maintenance requirement for scheduled banks from 90% to 99% of the prescribed CRR, effective 16 October 2026.
The step is aimed at ensuring orderly functioning of the system amid evolving liquidity conditions.
Separately, the RBI announced a three-day Variable Rate Reverse Repo auction on 12 October and an open market operation (OMO) sale of government securities.
మూలాలు: Topper IAS editorial (PIB / The Hindu / Indian Express)
ముఖ్య వాస్తవాలు
Remember these
- RBI raised the minimum daily CRR maintenance for scheduled banks from 90% to 99% of the prescribed CRR
- Effective 16 October 2026
- CRR is the share of a bank's Net Demand and Time Liabilities (NDTL) kept as cash with the RBI
- CRR balances earn no interest from the RBI
- RBI also announced a three-day VRRR auction on 12 October and an OMO sale of government securities
ప్రిలిమ్స్ · మెయిన్స్
How the exam will ask it
ప్రిలిమ్స్
- CRR is maintained by scheduled banks as a percentage of their NDTL in the form of cash balances with the RBI.
- Banks do not earn interest on balances maintained under the CRR.
- Raising the daily CRR maintenance requirement reduces the cash available to banks for lending and absorbs liquidity from the system.
- A Variable Rate Reverse Repo (VRRR) auction and an OMO sale of securities are both tools to absorb surplus liquidity.
మెయిన్స్
GS-III (Economy): Liquidity management is central to monetary policy transmission. The RBI tightened the daily CRR maintenance floor from 90% to 99% while also using VRRR and OMO sales, showing a mix of reserve-based and market-based tools. The implication is lower surplus liquidity and possible pressure on short-term rates and bank lending; the way forward is calibrated, transparent liquidity operations that keep inflation in check without hurting credit growth.
Quick recall
Answer before you reveal
Consider the following statements:
- In October 2026 the RBI raised the minimum daily Cash Reserve Ratio maintenance requirement of scheduled banks from 90% to 99% of the prescribed CRR.
- Scheduled banks earn interest from the RBI on the balances they maintain under the CRR.
Which of the statements given above is/are correct?
- 1 only
- 2 only
- Both 1 and 2
- Neither 1 nor 2
సమాధానం చూడండి
సమాధానం: A — Correct: 1 only — Statement 1 is correct, per the RBI's October 2026 order, and statement 2 is false because CRR balances earn no interest; hence 1 only. • 2 only — wrong: Statement 2 is wrong: CRR balances kept with the RBI do not earn interest, so '2 only' cannot hold. • Both 1 and 2 — wrong: Both cannot be correct because statement 2 is false; banks receive no interest on CRR balances. • Neither 1 nor 2 — wrong: Statement 1 is true, since the RBI did raise the daily maintenance requirement to 99% of the prescribed CRR, so 'neither' is wrong.
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