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Which of the following terms represents funds that banks must keep aside but earn no interest on?

easy Q2 of 15
Banking Awareness - Basics Of Banking & Banking Terminology
Which of the following terms represents funds that banks must keep aside but earn no interest on?
ASLR
BCRR
CRepo Rate
DReverse Repo Rate
Step-by-Step Solution

  1. Step 1: Identify interest condition

    The question specifies funds that earn no interest.

  2. Step 2: Recall RBI regulations

    CRR balances kept with RBI do not earn interest.

  3. Final Answer:

    CRR → Option B

  4. Quick Check:

    CRR balances are idle cash with RBI ✅
Quick Trick: No interest + RBI cash reserve = CRR.
Common Mistakes:
  • Assuming SLR also earns no return.
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