Source: The Hindu Every year RBI earns income from seigniorage | ECONOMY by VIVEK SINGH
Source: The Hindu Every year RBI earns income from seigniorage (currency printing) and other sources and out of this income some part it keeps with itself (contingency risk buffer) and some part it transfers (dividend) to Govt. of India. This is called 'Economic Capital Framework'.
Bimal Jalan Committee has recommended to keep contingency risk buffer in the range of 5.5% to 6.5% of the balance sheet (i.e. assets or liabilities).
Higher income of RBI may be because of higher currency circulation in the system due to higher economic growth and higher amount of transactions.
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