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In Banking field, SLR means:
Question

In Banking field, SLR means:

A.

Simple Lending Rate

B.

Statutory Lending Rate

C.

State Liquidity Ratio

D.

Statutory Liquidity Ratio

Correct option is D

The correct answer is (d) Statutory Liquidity Ratio.
· Statutory Liquidity Ratio (SLR) refers to the minimum percentage of a bank's net demand and time liabilities (NDTL) that it must maintain in the form of liquid assets such as cash, gold, or government-approved securities. It is a monetary policy tool used by the Reserve Bank of India (RBI) to regulate the credit growth and liquidity in the banking system.
Information Booster:
· Purpose: SLR helps ensure the solvency of banks and controls credit expansion.
· Current Rate: The SLR rate is set by the RBI and is periodically reviewed.
· Difference from CRR: Unlike the Cash Reserve Ratio (CRR), which is kept in cash with the RBI, SLR is maintained within the bank itself.

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