Q. Consider the following statements regarding Cash Management Bills:

1. They are short-term money market instruments.
2. They are issued only by the Central Government.
3. They are meant to meet temporary cash flow mismatches of the Central Government.

Which of the above statements are correct?
Answer: 1, 2 & 3
Notes: Cash Management Bills (CMBs) are non-standard, discounted short-term money market instruments introduced by the Central Government in consultation with RBI. They are issued only by the Central Government, have maturities less than 91 days, and are specifically designed to meet temporary cash flow mismatches faced by the Government of India.