Module: | Priority Sector, Consumer Protection & Digital Lending
Q66: Scenario: A Scheduled Commercial Bank has a required CRR of ₹100 Crore for the current fortnight. On Tuesday (a working day within the fortnight), the bank's actual balance with the RBI stands at ₹88 Crore. What is the regulatory implication?
✅ Correct Answer: B
The correct answer is B. While banks are required to maintain an average CRR of ₹100 Crore over the entire reporting fortnight, the RBI strictly mandates a daily minimum maintenance floor of 90% of the required amount to prevent extreme daily volatility in liquidity.
90% of ₹100 Crore is ₹90 Crore.
Because the bank's actual balance dropped to ₹88 Crore on Tuesday, it breached this daily statutory floor.
Consequently, the bank is non-compliant for that specific day and will be liable to pay penal interest on the shortfall, regardless of whether its fortnightly average eventually reaches the ₹100 Crore target.
90% of ₹100 Crore is ₹90 Crore.
Because the bank's actual balance dropped to ₹88 Crore on Tuesday, it breached this daily statutory floor.
Consequently, the bank is non-compliant for that specific day and will be liable to pay penal interest on the shortfall, regardless of whether its fortnightly average eventually reaches the ₹100 Crore target.