The correct answer is Option (1) → Cash Reserve Ratio.
Cash Reserve Ratio (CRR) refers to the percentage of a bank's total deposits that it is required to keep in the form of liquid cash with the Reserve Bank of India (RBI).
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This is a tool used by the central bank to control liquidity in the banking system.
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It is not available for lending or investment by banks.
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CRR is maintained in cash form, not in securities.
Other Options:
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Statutory Liquidity Ratio (SLR): This is also a reserve requirement, but it mandates banks to hold a certain percentage of their deposits in specified liquid assets, which can include cash, gold, and approved securities (like government bonds) with themselves, not necessarily directly with the central bank in the form of reserves.
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Bank Rate: This is the interest rate at which the central bank lends money to commercial banks, typically without the collateral of government securities. It's a policy rate, not a type of reserve itself.
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Reverse Repo: This is a monetary policy tool where the central bank sells government securities to commercial banks, thereby absorbing liquidity from the banking system. It's a transaction, not a standing reserve requirement.
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