RBI Extends Increased Borrowing Limit Under MSF Scheme For 3 More Months


oi-Olga Robert

By Staff


To meet the liquidity shortages caused by economic constraints due to the coronavirus pandemic, the Reserve Bank of India (RBI) has decided to extend the enhanced borrowing facility provide to banks, till 30 September 2020.

RBI Extends Increased Borrowing Limit Under MSF Scheme For 3 More Months

With effect from 27 March, the RBI, as a temporary measure, had increased the borrowing limit of scheduled banks under the marginal standing facility (MSF) scheme from 2 percent to 3 percent of their Net Demand and Time Liabilities (NDTL).

Under the MSF, banks can borrow overnight funds at their discretion by dipping into the Statutory Liquidity Ratio (SLR).

The relaxation was announced to be granted till 30 June 2020 and has now been extended till 30 September.

“On a review, it has now been decided to extend this enhanced limit till September 30, 2020,” the Reserve Bank of India (RBI) said in a circular.

Banks may continue to access overnight funds under the MSF against their excess SLR holding, it added.

The marginal standing facility rate currently stands at 4.25 percent.

RBI has also extended the relaxation on the minimum daily maintenance of the Cash Reserve Ratio (CRR) at 80 percent till 25 September 2020.

On 27 March, the minimum daily maintenance of the CRR was reduced from 90 percent of the prescribed CRR to 80 percent till 26 June 2020.

This was done in view of the continuing of hardships faced by banks in terms of social distancing of staff and consequent strains on reporting requirements.

fbq('track', 'PageView');

Source link

Devesh Tyagi

Technology Devesh is my dream blog, I share Tech News, Entertainment, Computer Tricks, Earn Money Online, Jobs related articles, Product Reviews, SEO, and Online Earning. I started this blog on 8 June 2019 to share my knowledge of Technology and Internet Marketing.

Leave a Reply

Your email address will not be published. Required fields are marked *