The current rates for CRR and SLR set by the Reserve Bank of India (RBI) are 3.00% for the Cash Reserve Ratio and 18.00% for the Statutory Liquidity Ratio.
The current Cash Reserve Ratio (CRR) set by the Reserve Bank of India is 3.00%. This means banks must keep 3 percent of their total deposits as cash with the central bank.
CRR is a reserve maintained by banks with the RBI. It is a percentage of the banks' deposits maintained in cash form. SLR is an obligatory reserve that commercial banks must maintain themselves. It is a percentage of commercial banks' net demand and time liabilities, maintained as approved securities.
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What is CRR and SLR as per NRB?
CRR mandates banks to maintain a certain percentage of deposits with NRB in cash, while SLR requires maintaining liquid assets as a proportion of deposits (currently liquid assets to deposits stand at 23.58%).
What is the Cash Reserve Ratio? In simple terms, the Cash reserve ratio is a certain percentage of cash that all banks have to keep with the RBI as a deposit. This percentage is fixed by the RBI and is changed from time to time by the central bank itself. Currently, the CRR is fixed at 4.50%.
As an essential tool in the central bank's armory, the cash reserve ratio is important for maintaining the stability and health of the banking system. The reserves under the CRR system must be held in cash.
Banks do not earn any interest from the RBI in case of the cash parked with RBI under CRR requirements. Banks earn interest. This is because, under SLR requirements, banks are supposed to invest in liquid assets like central and state government securities/bonds. These bonds earn banks some interest.
The Reserve Bank of India (RBI) decides both the Cash Reserve Ratio (CRR) and the Statutory Liquidity Ratio (SLR). The central bank sets these rates to control the money supply, manage inflation, and keep the banking system stable.
Reserve Bank on Friday (June 6, 2025) decided to cut Cash Reserve Ratio (CRR) by a huge 1%, which will unlock ₹2.5 lakh crore liquidity to the banking system for lending to productive sectors of the economy. With the reduction in four equal tranches ending November 29, 2025, the CRR would come down to 3%.
The increased CRR rate means that banks have a low lending capacity in terms of funds. Consequently, banks would like to open more deposit accounts. Also, Banks will increase the interest rate which will discourage borrowers from applying for loans because high-interest rates indicate higher loan expenses.
The current Cash Reserve Ratio (CRR) in India is 3.00% as set by the Reserve Bank of India. This means banks must keep 3% of their Net Demand and Time Liabilities (NDTL) as cash reserves.
The SLR rate, or Statutory Liquidity Ratio, is the minimum percentage of deposits that commercial banks must keep in safe, liquid assets like cash, gold, or government approved securities rather than lending them out. The current SLR rate in India is 18%, set by the Reserve Bank of India, with a legal maximum limit of 40%.
The next Reserve Bank of India (RBI) interest rate decision is scheduled to be announced on August 5, 2026, following the Monetary Policy Committee (MPC) meetings held from August 3 to August 5, 2026.
Usage: CRR is primarily used for short-term liquidity management, while SLR is utilized for long-term investment management. Impact on Interest Rates: CRR directly affects lending rates, while SLR indirectly influences lending rates. Statutory Requirement: Both CRR and SLR are mandatory for all banks.
Yes, the Cash Reserve Ratio (CRR) is kept with the Reserve Bank of India. Scheduled commercial banks must maintain a specific percentage of their deposits as cash balances directly with the central bank.
When the Reserve Bank of India (RBI) reduces the Cash Reserve Ratio (CRR), it increases lendable resources, boosts overall market liquidity, and expands the money supply in the economy.
Presently, banks are not paid any interest on behalf of the RBI for parking the required cash. If a bank fails to meet its required reserve requirements, the RBI is empowered to impose a penalty by charging a penal interest rate. Historically, the CRR was mooted as a regulatory tool.
Cash Reserve Ratio (CRR) is the amount of funds that all Scheduled Commercial Banks (SCB) excluding Regional Rural Banks (RRB) are required to maintain without any floor or ceiling rate with RBI with reference to their total net Demand and Time Liabilities (DTL) to ensure the liquidity and solvency of Banks (Section 42 ...
Banks have to maintain 100 percent CRR on an average basis during the fortnight. That is, it is not necessary that on all days CRR has to be at 100%. With effect from December 28, 2002 all banks were required to maintain a minimum of 70 per cent of the required average daily CRR on all days of the fortnight.
