Indian banking glossary
Repo rate
The interest rate at which the RBI lends overnight funds to banks against government securities. It is the central policy lever: raising it makes credit costlier to cool inflation, cutting it supports growth. Repo rate timeline → · Related rulebook: Financial Markets Regulation →
CRAR (Capital adequacy)
Capital to Risk-weighted Assets Ratio — a bank's capital expressed as a percentage of its risk-weighted exposures. It measures the cushion available to absorb losses; Indian banks must hold a minimum of 11.5% including the capital conservation buffer. Bank health scores → · Related rulebook: Department of Regulation →
Gross NPA (GNPA)
The total value of loans a bank has classified as non-performing — broadly, where the borrower has not paid interest or principal for 90 days or more — as a percentage of gross advances. NPA tracker → · Related rulebook: Department of Regulation →
Net NPA (NNPA)
Gross NPAs after deducting the provisions a bank has already set aside against them. It shows the un-provided stress still sitting on the balance sheet, and is always lower than gross NPA. NPA tracker → · Related rulebook: Department of Regulation →
Provision Coverage Ratio (PCR)
The share of gross NPAs already covered by provisions. A higher PCR means a smaller part of the bad-loan book can hurt future profits if it has to be written off. NPA tracker → · Related rulebook: Department of Regulation →
Slippage
Fresh additions to non-performing assets in a period — loans that were standard at the start and turned bad. Bankers watch slippage alongside the NPA ratio because it shows the direction of asset quality, not just the level. NPA tracker → · Related rulebook: Supervision →
Credit-deposit ratio (CD ratio)
Outstanding bank credit as a percentage of total deposits. A high ratio means banks are lending out most of the money they take in, which tightens funding and intensifies competition for deposits. Credit & deposit growth → · Related rulebook: Financial Inclusion / Priority Sector →
CASA
Current Account and Savings Account deposits — the low-cost, often non-interest or low-interest balances banks prize because they reduce the average cost of funds and lift net interest margins. Credit & deposit growth → · Related rulebook: Department of Regulation →
LCR (Liquidity Coverage Ratio)
The stock of high-quality liquid assets a bank must hold to cover net cash outflows over a 30-day stress scenario. It must stay above 100%, ensuring banks can survive a short, sharp liquidity shock. Bank health scores → · Related rulebook: Department of Regulation →
Priority Sector Lending (PSL)
RBI rules requiring banks to direct a set share of credit to segments such as agriculture, micro and small enterprises, and weaker sections, so that credit reaches productive but under-served parts of the economy. PSL rules → · Related rulebook: Financial Inclusion / Priority Sector →
KYC / AML
Know Your Customer and Anti-Money-Laundering obligations — the identity-verification, monitoring and reporting duties banks must follow to prevent their systems being used for money laundering or terror financing. KYC / AML rules → · Related rulebook: Department of Regulation →
Master Direction
A consolidated, standing RBI rulebook on a subject that pulls together the relevant instructions in one place and is updated as the rules change — the authoritative reference banks turn to first. Master Direction crosswalk →
Key Facts Statement (KFS)
A short, standardised summary a lender must give a borrower up front, setting out the all-in interest rate, fees, charges and key terms so the true cost of a loan is clear before signing. Home-loan rules → · Related rulebook: Department of Regulation →
External Benchmark Lending Rate (EBLR)
A framework requiring most floating-rate retail and small-business loans to be priced off an external benchmark (such as the repo rate) plus a transparent spread, so policy-rate changes pass through to borrowers faster. Home-loan rules → · Related rulebook: Department of Regulation →
Scheduled Commercial Bank (SCB)
A bank listed in the Second Schedule of the RBI Act that meets defined capital and conduct conditions. Most published banking-system statistics — credit, deposits, NPAs — are aggregates for SCBs. Bank health scores → · Related rulebook: Department of Regulation →
Cash Reserve Ratio (CRR)
The share of a bank's deposits it must keep as cash with the RBI, earning no interest. Raising the CRR drains liquidity from the banking system; cutting it releases funds banks can lend. Monetary policy timeline → · Related rulebook: Financial Markets Regulation →
Statutory Liquidity Ratio (SLR)
The minimum share of deposits a bank must hold in safe, liquid assets such as government securities, gold or cash before lending the rest. It safeguards solvency and channels funds to government borrowing. Deposit & rate rules → · Related rulebook: Financial Markets Regulation →
MCLR
Marginal Cost of Funds based Lending Rate — the internal benchmark below which a bank generally cannot price a loan. It links lending rates to a bank's own marginal funding cost and is being steadily replaced by external benchmarks for retail loans. Home-loan rules → · Related rulebook: Department of Regulation →
Net Interest Margin (NIM)
The gap between the interest a bank earns on loans and investments and the interest it pays on deposits and borrowings, as a percentage of its earning assets. It is the core measure of a bank's lending profitability. Bank health scores → · Related rulebook: Department of Regulation →
Return on Assets (RoA)
A bank's net profit expressed as a percentage of its total assets — how much profit each rupee of assets generates. RoA above 1% is generally read as a healthy, well-run bank. Bank health scores → · Related rulebook: Supervision →
Special Mention Account (SMA)
An early-warning category for loans that are overdue but not yet non-performing: SMA-0 (up to 30 days), SMA-1 (31-60 days) and SMA-2 (61-90 days). It flags stress before an account slips into NPA. NPA tracker → · Related rulebook: Department of Regulation →
Risk-Weighted Assets (RWA)
A bank's exposures scaled by how risky each one is, so that a safe government bond carries far less weight than an unsecured loan. Capital ratios are measured against RWA, not raw assets. Capital & Basel rules → · Related rulebook: Department of Regulation →
Tier 1 & Tier 2 capital
The two layers of regulatory capital. Tier 1 is the core, loss-absorbing capital (mainly equity and reserves); Tier 2 is supplementary capital such as certain subordinated debt. Together they make up a bank's total capital base. Capital & Basel rules → · Related rulebook: Department of Regulation →
NBFC
Non-Banking Financial Company — a lender that provides credit and other financial services but cannot accept demand deposits or issue cheques. NBFCs are regulated by the RBI under a scale-based framework. NBFC rules → · Related rulebook: NBFC Regulation →
Wilful defaulter
A borrower who can repay but deliberately does not, or who diverts or siphons off borrowed funds. RBI rules bar wilful defaulters from fresh bank finance and require lenders to report and publish their names. NPA tracker → · Related rulebook: Department of Regulation →
Deposit insurance (DICGC)
Cover provided by the Deposit Insurance and Credit Guarantee Corporation, an RBI subsidiary, that protects each depositor up to Rs 5 lakh per bank if the bank fails. It underpins public trust in the deposit system. Deposit & rate rules → · Related rulebook: Consumer Protection →
UPI
Unified Payments Interface — the real-time, mobile-first payment system that lets users move money instantly between bank accounts using a virtual ID, without sharing account details. It is the backbone of India's retail digital payments. UPI rules → · Related rulebook: Payment & Settlement Systems →