Module: | Priority Sector, Consumer Protection & Digital Lending
Q60: For the purpose of CRR maintenance, the relevant NDTL figure is taken from which specific reporting day?
✅ Correct Answer: C
The correct answer is C. The calculation of the Cash Reserve Ratio (CRR) is not based on the real-time daily liabilities, as it would be administratively impossible for banks to compute exact daily figures instantly.
Instead, the Reserve Bank of India mandates that CRR must be maintained based on the Net Demand and Time Liabilities (NDTL) calculated as of the "Reporting Friday of the second preceding fortnight." This specific mechanism inherently provides a 14-day time lag.
This lag affords banks adequate time to accurately calculate their total deposits and liabilities across all branches, and arrange the necessary cash balances to comply with the RBI's reserve requirements without facing sudden daily liquidity shocks.
Instead, the Reserve Bank of India mandates that CRR must be maintained based on the Net Demand and Time Liabilities (NDTL) calculated as of the "Reporting Friday of the second preceding fortnight." This specific mechanism inherently provides a 14-day time lag.
This lag affords banks adequate time to accurately calculate their total deposits and liabilities across all branches, and arrange the necessary cash balances to comply with the RBI's reserve requirements without facing sudden daily liquidity shocks.