CRR: RBI raises daily minimum maintenance to 99% from October 16
Why in the news
The Reserve Bank of India raised the daily minimum Cash Reserve Ratio (CRR) maintenance for scheduled banks from 90% to 99% of the requirement, a step to absorb surplus liquidity after its recent repo rate hike.
Key facts
- Circular: RBI/2026-27/290, dated October 9, 2026, addressed to all scheduled banks.
- Change: daily minimum CRR balance raised to 99% from 90% of the required amount.
- Effective: from the reporting fortnight beginning October 16, 2026.
- Unchanged: the average daily CRR over the fortnight must still be at least the prescribed level, which is 3%.
- Legal basis: Section 42(1) of the RBI Act, 1934.
- Reason: RBI cited a review of current liquidity conditions.
| Period | Daily minimum CRR |
|---|---|
| July 2013 | 99% |
| September 2013 | 95% |
| April 2016 | 90% |
| From October 16, 2026 | 99% |
About the liquidity context
RBI recently raised the policy repo rate by 25 basis points to 5.50%. Surplus funds parked under the liquidity adjustment facility stood at about Rs 3.88 lakh crore on October 8. The corridor runs from the standing deposit facility rate of 5.25% to the marginal standing facility rate of 5.75%. RBI has also scheduled a Rs 25,000 crore sale of government securities on October 13.
Exam angle
- The CRR obligation of scheduled banks flows from Section 42(1) of the RBI Act, 1934.
- A higher daily minimum cuts banks’ flexibility to run down CRR balances, tightening liquidity.
- Remember the numbers: 90% to 99%, CRR at 3%, repo at 5.50%.