Which one among the following is the precious metal (Gold) or other approved securities that a commercial bank must maintain as reserves other than the cash with RBI?

Cash Reserve Requirement

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Statutory Liquidity Requirement

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Forward Fund

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Reserve Money

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Solution

The correct option is B Statutory Liquidity Requirement
Statutory Liquidity Ratio (SLR) refers to the percentage of money which the banks have to set aside and invest in gold or RBI approved securities. It is maintained by the banks with themselves and restricts the banks' leverage in pumping more money into the economy.

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