Cash reserve ratio

The proportion of its net demand and time liabilities, mainly deposits, that a bank must hold as cash with the central bank, earning nothing.

A bank with ₹55,000 crore of net demand and time liabilities at a 3% requirement, the rate after the RBI's 2025 cuts, holds ₹1,650 crore sterile.

CRR is both a monetary tool and a tax on banking. Raising it withdraws liquidity from the system and simultaneously reduces bank profitability, because the reserved money earns no interest while the deposit it came from still costs interest.

Current rates are set by the central bank and they change, so verify before you use a figure.