What changed
This master circular replaces the previous one dated August 5, 2004, compiling all circulars on CRR and SLR that are operational as of July 19, 2005. No new policy changes were introduced; it is a consolidation exercise.
What it means for you
Banks must continue to maintain CRR at 5% of NDTL and SLR as per existing norms. The circular clarifies that no incremental CRR is currently required. It serves as a single reference document for compliance, reducing confusion from multiple circulars.
What you must do
- Ensure CRR is maintained at 5% of NDTL on a fortnightly basis.
- Submit Form A return for CRR compliance under Section 42(2) of RBI Act, 1934.
- Submit Form VIII return for SLR compliance under Section 24 of Banking Regulation Act, 1949.
- Classify demand and time liabilities correctly as per definitions in the circular.
- Refer to this master circular as the single source for all CRR and SLR instructions.
Who it affects
All Scheduled Commercial Banks, Treasury and compliance departments, Risk management teams
What is the current CRR rate as per this circular?
The CRR rate is 5% of Net Demand and Time Liabilities (NDTL), effective from the fortnight beginning October 2, 2004.
Is there any incremental CRR requirement?
No, as per the circular, no incremental CRR is required to be maintained by Scheduled Commercial Banks at present.
What returns are used to monitor CRR and SLR compliance?
CRR compliance is monitored via Form A return under Section 42(2) of RBI Act, 1934, and SLR compliance via Form VIII return under Section 24 of Banking Regulation Act, 1949.