NDTL Full Form

NDTL Full Form

NDTL full form is Net Demand and Time Liability.

In simple words NDTL is a difference between the sum of demand and time liability and the deposit held with other Banks. NDTL used in calculation of CRR and SLR and other measures which helps in controlling liquidity of money in the economy.

 Formula to calculate Net Demand and Time Liability

NDTL =(DL+TL+ODTL) – Bank Assets in Bank system

For example:

DL = Demand Liability is 10000
TL = Time Liability is 20000
ODTL= Other Demand and Time Liabilities is 1500
Bank assets in the system are 5000.


Bank Assets in the bank system.

It's includes 

a) Balances with banks in current accounts.

b) Balances with other banks and notified financial institutions.

c) Funds made available to the banking system from loans.

d) Deposits repayable at call or short notice of a fortnight.

e) Loans other than money at call and short notice.

f) Any other amounts due from the banking system which are not classified under any of the above items.

g) Sums placed by banks issuing drafts, interest, dividend warrants under remittance arrangement are to be treated as ‘Assets with banking system’ in their books and can be netted off from their inter-bank liabilities.

For example a bank has deposited 5,00,000 with the other bank and its total demand and time liabilities is 10,00,000.
In this case the net demand and time liabilities will be 5,00,000. (10,00,000-5,00,000).

Banks deposits are its liabilities. Its can be in the form of demand liability, time liability and other demand liability.

Demand Liabilities

The demand liabilities which includes liabilities of a bank which are payable on demand.

Demand Liability examples:
Current deposits.
Cash certificates.
Recurring deposits.
Demand drafts.
Margins against the letter of credit/guarantees.
Credit balance in a cash credit account.

Time Liabilities:

Time liabilities are the liabilities of a bank which are payable otherwise on demand.

Time liabilities examples

Fixed deposits.
Cash certificates.
Staff security deposits.
Time liabilities portion of saving deposits account.
Margin held against the letter of credit if they are not payable on demand.
Gold deposits.

Other Demand and Time Liabilities: 

ODTL includes all those miscellaneous liabilities which are not covered in above two types of liabilities.

Other Demand And Time Liability examples.

Interest accrued on deposits.
Unpaid dividend.
Suspense account balances. Showing the amount due to other banks or the public.
Participation certificates issued to other banks.
Cash collaterals.

What is the need for NDTL

NDTL is required for the computation of the Cash Reserve Ratio (CRR), Statutory Liquidity Ratio (SLR) and different tools and measures. These tools and measures help in keeping up liquidity in the economy.

Every financial year Statutory Auditors should verify and certify that all items of outside liabilities, as per the bank’s books duly compiled by the bank and correctly reflected under DTL/NDTL in the fortnightly and monthly statutory returns submitted to RBI.

Dear readers hope you got the good information related to what is NDTL.
If you want to ask any questions related to NDTL you can comment. 

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