economics medium Fill in the Blank

To meet temporary mismatches between the government's receipts and payments, the RBI provides short-term, interest-bearing loans to the Central and State governments known as _ and _ Advances (WMA).

Ways and Means
increase
first
1992

Answer: Ways and Means

WMA is a crucial cash management tool. It is not a source of long-term deficit financing; rather, it's an overdraft facility that smooths out daily or weekly liquidity bumps (e.g., tax collections are delayed, but salary payouts are due). The government must clear the WMA balance quickly, and crossing the limit forces the government to issue market bonds or cut spending.

Topic Public Finance - RBI Functions

Exam Relevance UPSC Prelims, Banking, SSC

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To meet temporary mismatches between the government's receipts and payments, the RBI provides short-term, interest-bearing loans to the Central and State governments known as _ and _ Advances (WMA).

Quick Quiz Actions

Create a custom practice set

Weekly challenge coming soon

To meet temporary mismatches between the government's receipts and payments, the RBI provides short-term, interest-bearing loans to the Central and State governments known as ___ and ___ Advances (WMA).

To meet temporary mismatches between the government's receipts and payments, the RBI provides short-term, interest-bearing loans to the Central and State governments known as _ and _ Advances (WMA).