What is the difference between CRR and SLR?
Cash Reserve Ratio is the necessary minimum percentage of a bank’s total deposits that is to be kept with the central bank. Commercial banks need to maintain with the central bank a certain percentage of their deposits in the form of cash reserves. The central bank can vary the CRR between 3 and 15 percent.
Statutory Liquidity Ratio is the fixed percentage of assets in the form of cash or other liquid assets, that a bank must maintain with the central bank. The central bank can vary the SLR between 20 and 40 percent.