1. Cash Reserve Ratio (CRR):
2. Statutory Liquidity Ratio (SLR):
The CRR and the SLR is used by the Reserve Bank of India to ensure liquidity in the banking system and influence the availability of resources in the banking system for lending to the private sector.
An increase in the Cash Reverve and Statutory Liquidity Ratio leaves less resources available with the commercial banks to lend to the private sector and forms one of the many tools used by the RBI to control Inflation.
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