Banking Ombudsman: Banking Ombudsman is a quasi-judicial authority, which functions under India’s Banking Ombudsman Scheme 2006. It was created by Government of India with a purpose to deal with the complaints of customers of the banks related to various services rendered by the banks.
Deflation: It is a decrease in the general price level of goods and services.
Inflation: It can be defined as a sustained increase in the general level of prices for goods and services.
Liquidity: Liquidity describes the degree to which an asset or security can be quickly bought or sold in the market without affecting the asset’s price.
Merchant Banking: It is a combination of Banking and consultancy services.
Monetary Policies: It refers to the use of instruments by Reserve Bank of India (RBI) to regulate the availability, cost and use of money and credits.
Plastic Money: It is a term used in reference to the hard plastic cards we use every day in place of actual bank notes.
Direct Instruments:-
Cash Reserve Ratio (CRR): Cash reserve Ratio (CRR) is the amount of funds that the banks have to keep with the RBI.
Refinance Facilities: RBI offers refinance facility to help out the exporters by replacing an existing debt obligation with another.
Statutory liquidity ratio (SLR): SLR is the minimum proportion of their Net Demand and Time Liabilities, which every bank maintains in the form of cash, gold and securities, at the close of business every day.
Indirect Instruments:-
Bank rate: The rate of interest which the RBI charges on the loans and advances to a commercial bank.
Liquidity adjustments facility (LAF): It’s a monetary policy tool which allows banks to borrow money through repurchase agreements and adjusting the day to day mismatches in liquidity.
Marginal standing facility (MSF): It’s a window for banks to borrow from the RBI in an emergency situation when inter-bank liquidity finishes completely.
Market Stabilization scheme (MSS): Securities that are issued with the objective of providing a stock of securities to the RBI to intervene in the market for managing liquidity.
Open Market Operations (OMO): It’s an activity by a RBI to give or take liquidity in its currency to or from a bank or a group of banks.
Repo rate: The rate at which the RBI lends money to commercial banks in the event of any shortfall of funds.
Reverse Repo Rate: The rate at which the RBI borrows money from commercial banks within the country.
Term Repo: A repurchase agreement with a term of more than one day.
Money Market Instruments:-
Authorized Capital: The authorized capital/ registered capital/nominal capital of a company is the maximum amount of share capital that the company is authorized by its constitutional documents to issue to shareholders.
Bonds: It is an instrument of indebtedness of the bond issuer to the holders.
Call Money: Money loaned by a bank or other institution which is repayable on demand.
Commercial Bills: A bill of exchange issued by a commercial organization to raise money for short-term needs.
Commercial Papers: An unsecured, short-term debt instrument issued by a corporation for the financing of accounts receivable, inventories and meeting short-term liabilities.
Certificates of deposits (CD): A savings certificate entitling the bearer to receive interest.
Dated government securities: These are long-term securities and a fixed or floating coupon/interest rate which is paid on the face value, payable at fixed time periods.
Debentures: A long-term security bearing a fixed rate of interest, issued by a company and secured against assets.
Issued Capital: The share capital that has been issued to shareholders.
Mutual Funds: It is a professionally managed investment fund that pools money from many investors to purchase securities.
Net Asset Value (NAV): A mutual fund’s price per share or exchange-traded fund’s (ETF) per-share value.
Paid up Capital: The amount of a company’s capital that has been funded by shareholders.
Treasury bills: A short-dated UK/US government security, bearing no interest but issued at a discount on its redemption price.
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