Statutory Meaning & Definition
The mandatory percentage of a bank's net demand and time liabilities (NDTL) that must be maintained as cash reserves with the Reserve Bank of India. CRR does not earn interest for banks. Used as a monetary policy tool to control liquidity.
Frequently Asked Questions (FAQs)
What is Cash Reserve Ratio in Indian corporate law?
The mandatory percentage of a bank's net demand and time liabilities (NDTL) that must be maintained as cash reserves with the Reserve Bank of India. CRR does not earn interest for banks. Used as a monetary policy tool to control liquidity.
Why is Cash Reserve Ratio important for compliance?
Cash Reserve Ratio is governed by the Reserve Bank of India under applicable banking and monetary policy frameworks. Understanding this concept is essential for ensuring regulatory compliance, avoiding penalties, and making informed corporate decisions in India.
Who should know about Cash Reserve Ratio?
Cash Reserve Ratio is relevant for company secretaries, compliance officers, chartered accountants, corporate lawyers, board members, and all professionals dealing with RBI regulatory matters in India.
Contextual Analysis & Regulatory Circulars
Recent analysis and regulatory updates related to RBI:
RBI Domestic Money Transfer Directions 2026: Cash Pay-Out and Pay-In Limits Explained
Published: 11 November 2026
RBI CTS Cheque Book Change from 31 December 2026 Is Fake: No New Cheque Books from 1 January 2027
Published: 8 November 2026
RBI Priority Sector Lending Draft Directions 2026: Five RE-Wise Drafts, Comments Open Till 26 November
Published: 6 November 2026
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