The banking system will become flush with liquidity aggregating ₹3.74 lakh crore as the Reserve Bank of India (RBI) has, among others, decided to cut the cash reserve ratio (CRR) to 3 per cent from 4 per cent and decided to conduct more long-term repo operation (LTRO).
CRR cut, which will be effective for a year, will result in infusion of primary liquidity for banks aggregating ₹1.37 lakh crore.