Question
Which of the following is the short-term loans provided
by the RBI to the government to help it deal with any discrepancies between receipts and payments?Solution
Ways and means advances is a mechanism used by Reserve Bank of India under its credit policy to provide to States, banking with it, to help them tide over temporary mismatches in the cash flow of their receipts and payments. Reserve Bank of India reduced the Ways and Means Advances (WMA) for states and union territories to Rs 47,010 crore from Rs 51,560 crore. The Government of India’s WMA limit for the first half of fiscal year 2022-23 has been set at Rs 1,50,000 crore.
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