Q. In context with banking and Finance markets, what is Collateralized Borrowing and Lending Obligation (CBLO)”, ?
Answer: It’s a money Market Instrument of Reserve bank of India
Notes: Collateralized Borrowing and Lending Obligation (CBLO) is a money market instrument introduced by the Reserve Bank of India (RBI) to facilitate borrowing and lending among banks and financial institutions. It allows participants to borrow funds against collateral, typically government securities, for short-term needs. CBLO helps enhance liquidity in the money market and is governed by the Clearing Corporation of India Ltd. (CCIL). It is particularly useful for managing liquidity mismatches and is a key tool in the Indian financial system.