Existing laws don’t allow interest on CRR: Chakrabarty

Dec 11 2012, 00:36 IST
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SummaryThe Reserve Bank of India can pay interest to banks on their cash reserve deposits if the laws are changed, senior-most deputy governor Kamalesh Chandra Chakrabarty has said.

The Reserve Bank of India (RBI) can pay interest to banks on their cash reserve (CRR) deposits if the laws are changed, senior-most deputy governor Kamalesh Chandra Chakrabarty has said.

“Under the present law, I can’t pay interest on the CRR...that modification came four-five years back...The government should change the rule (for payment of interest on CRR),” Chakrabarty said in an interaction at his office.

“If the CRR is a cost on banks, then they can adjustthat somewhere else,” he added.

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