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Ways and Means Advances
It's a mechanism under which RBI lends to the governments (Centre or states) to help them manage the mismatches between revenue and expenditure.
The limits for WMA are mutually decided by the RBI and the Government of India.
The rate of interest is the same as the repo rate, while the tenure is three months.
Two types of WMA –
Normal WMA are clean advances.
Special WMA are secured advances provided against the pledge of Government of India dated securities.
Ways and Means Advances
It's a mechanism under which RBI lends to the governments (Centre or states) to help them manage the mismatches between revenue and expenditure.
The limits for WMA are mutually decided by the RBI and the Government of India.
The rate of interest is the same as the repo rate, while the tenure is three months.
Two types of WMA –
Normal WMA are clean advances.
Special WMA are secured advances provided against the pledge of Government of India dated securities.