The Reserve Bank of India vide its notification dated 4th May 2022, has decided to increase the Cash Reserve Ratio (CRR) of all banks by 50 basis points from 4.00 percent to 4.50 percent of their Net Demand and Time Liabilities (NDTL), effective from the reporting fortnight beginning May 21, 2022.
CRR is a percentage of a bank’s total deposits that it needs to maintain as liquid cash. By making changes in the CRR rate, RBI is able to keep inflation at its desired level and control and monitor money flow in the banking system.
