Reserve Ratio Calculator
Calculate required reserves, excess reserves, and money multiplier for banks
%
RBI Preset Ratios (India)
Compare Two Ratios
Calculation Results
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Required Reserves
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📈
Excess Reserves
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🔄
Money Multiplier
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💸
Max Lending Potential
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Ratio Comparison Impact
Old Ratio Impact
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New Ratio Impact
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Difference
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How Reserve Banking Works
Fractional-reserve banking is a system where banks hold only a fraction of their deposits in reserve and lend out the remainder. This creates money through the money multiplier effect.
Key Formulas
Required Reserves = Deposits × Reserve Ratio
Money Multiplier = 1 / Reserve Ratio
Max Lending = Deposits × Money Multiplier
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