Banking Terminologies for GA Banking terms can be confusing, but they are essential for understanding how financial institutions operate. Here are the key te...
Banking terms can be confusing, but they are essential for understanding how financial institutions operate. Here are the key terms you need to know for GA:
RBI (Regional Bank Interbank Committee)
RBI is an international organization that facilitates the settlement of payments between banks in different countries.
It aims to ensure smooth and efficient cross-border payments, especially during times of economic stress.
RBI also plays a role in promoting competition and preventing anti-competitive practices among banks.
Repo (Rate Repository)
A repo is a short-term loan that a bank lends to another bank.
The borrower agrees to repay the loan with interest at a later date.
This creates a temporary increase in the money supply, which can stimulate economic growth.
CRR (Currency Requirements Ratio)
A CRR is a minimum percentage of deposits that a bank must hold in reserve.
This ratio helps to ensure that banks do not lend out more money than they have available.
A higher CRR means that banks are less likely to lend out money, which can help to stabilize the economy