RBI needs to reduce CRR as a tool to control credit: Rangarajan

The Reserve Bank of India needs to bring down the cash reserve ratio (CRR) and control credit flow through open market operations, C Rangarajan, chairman, Prime Minister's Economic Advisory Council, said on Thursday.

The CRR is the proportion of deposits banks must set aside with the RBI.

Earlier this month, the country's largest public sector lender State Bank of India had sought scrapping of CRR, which stands at 4.75%.