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CONTINUED..
Functions
Balancing mechanism for demand &
supply of money
Provide the focal point to central bank
to provide liquidity
Provide reasonable access to
suppliers & user of short term funds
to fulfill the requirements.
Structure
Participants
RRBs.
Cooperative banks
Trusts
Insurance companies
Mutual funds
T- bills
CP
CDs
Call/Notice Money market
Repos
Dated Government securities.
Treasury Bills
Features of T Bills
Negotiable
Highly liquid
Absence of default risk
Assured yield & eligible In SLR
91 days- 182 days-364 days
Minimum amt is 25000
Types of T Bills
Commercial paper
Commercial paper
A
Certificate of Deposit
Certificate of Deposit
Features of CD
Commercial bill
Repos
Reverse repo