Approved Training Partner of NSDC

NSDC - Skill India

Fluctuating Liquidity in Banking System Raises Concerns

Bajaj Finserv Asset Management Launches New Banking and PSU Fund

The banking system had more money available on Tuesday, thanks to the government spending some money, according to market experts. However, people think that the banking system might run short of .Money again because the Reserve Bank of India (RBI) is not happy when there’s extra money. A dealer from a state-owned bank said, “The only thing helping us have more money is the government spending. But it will likely run short of money again because the RBI prefers it when we don’t have too much. Plus, the market has gotten used to borrowing at a certain interest rate.”

On Tuesday, banks put Rs 1,512 crore into the RBI, as per the data from the RBI

The banking system has mostly been short of money since September 15. On September 19, it got really low, nearly reaching Rs 1.47 trillion. This was the highest shortage of money since January 29, 2020 when the banking system ran short of a massive Rs 3 trillion.

In simpler terms, the banking system had more money on Tuesday because the government spent some. But people think it might run short of money again because the RBI prefers it that way. A banker mentioned that the government’s spending is the only thing that helps keep the system running with enough money. However, they believe it will run short of money again because the RBI seems to like it when there’s not too much extra money in the system.

The banks put Rs 1,512 crore into the RBI on Tuesday, and this situation of not having enough money has been going on since September 15. On September 19, the shortage was really big, almost reaching Rs 1.47 trillion. This was the largest shortage of money since January 29, 2020, when the banking system ran short of a massive Rs 3 trillion.

So, in simple terms, the banking system had more money for a little while, but it might not last, and it’s been running short of money since September 15. This situation can be a bit tricky and can affect how the banks operate.

Facebook
WhatsApp
Twitter
LinkedIn
Pinterest

Leave a Reply

Your email address will not be published. Required fields are marked *