The banks are required to maintain a certain ratio between their cash in hand and total assets. This is called

The ratio that requires banks to hold a portion of deposits as cash reserves is the Cash Reserve Ratio (CRR). CRR mandates that banks keep a specified percentage of deposits as cash with the central bank (e.g., CRR = 20% means Rs.20 of Rs.100 deposits must be held as cash reserves) [1]. CRR is maintained in cash with the RBI, whereas the Statutory Liquidity Ratio (SLR) is a separate requirement held by banks themselves in cash, gold or government securities and is therefore not identical to CRR [2]. Because CRR (the precise term) is not among the provided options, SLR (option 2) is the closest related choice; this discrepancy warrants manual review.

Sources

1. [1] Macroeconomics (NCERT class XII 2025 ed.) > Chapter 3: Money and Banking > Cash Reserve Ratio (CRR) = Percentage of deposits which a bank must keep as cash reserves with the bank. > p. 40
2. [2] Indian Economy, Nitin Singhania .(ed 2nd 2021-22) > Chapter 7: Money and Banking > CASH RESERVE RATIO (CRR) vs STATUTORY LIQUIDITY RATIO (SLR) > p. 170