Reserve Bank of India cut statuary liquidity ratio (SLR) by 50 basic points. Now SLR is 21.5%. As a result of this move, banks will have their hand an additional Rs 42,000 crore to lend.
SLR is the portion of deposits that a bank must invest in government bonds.
Moreover, the RBI also introduced a new category of ‘unbreakable’ fixed deposits – an FD that cannot be withdrawn prematurely but will have higher interest rates.
