The RBI board has approved a record surplus transfer of Rs 2.69 lakh crore to the government for FY 2025. In the last financial year 2023-24, RBI had made a surplus transfer of Rs 2.10 lakh crore to the government. That is, these are 28% higher than last year.
These transfers of surplus are for FY25, but it will appear in the government’s account for FY26. The surplus was announced at the 616th meeting of the Central Board of Directors of RBI.
The difference between income and expenditure is surplus
The difference between the income and expenditure of RBI is called surplus. RBI transfers the surplus to the government after provisioning and retained earnings for the reserve. According to Section 47 (Allocation of Surplus Profit) of the Reserve Bank of India Act, 1934, these transfers take place.
How does RBI generate surplus? RBI Income:
- Interest on holdings of domestic and foreign securities
- Fees and commissions from services
- Profit from foreign exchange transactions
- Returns from Subsidiaries and Associate Companies
RBI expenditure:
- Printing of currency notes
- Payment of interest on deposits and borrowings
- Salaries and pensions of employees
- Operational expenses of offices and branches
- Sudden need for money and provision for depreciation
- Highest surplus till date
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