BANKING AFFAIRS

Detailed explanation-1: -b) The maintenance of CRR shall be reported to Reserve Bank of India under the following statutory returns: Form A Return for Scheduled Commercial Banks (including Regional Rural Banks (RRBs)), Small Finance Banks, Payments Banks and Local Area Banks.

Detailed explanation-2: -Cash Reserve Ratio (CRR) is the share of a bank’s total deposit that is mandated by the Reserve Bank of India (RBI) to be maintained with the latter as reserves in the form of liquid cash.

Detailed explanation-3: -For the purpose of maintaining CRR, every scheduled bank is required to maintain a Principal Account with the Deposit Accounts Department (DAD) of the Reserve Bank of India at the centre where the principal office of the bank is located.

Detailed explanation-4: -The RBI provides a specific CRR for each commercial bank in the nation. Each bank will be asked to retain a specific amount of its deposits in the current account of the central bank. The RBI has the authority to set the cash reserve ratio between 3% and 15%.