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“Primarily based on an evaluation of the prevailing and evolving liquidity situations, the Reserve Financial institution of India has determined that an extra mixture quantity of ?5,000 crore will likely be made accessible to the Standalone Major Sellers beneath the Standing Liquidity Facility on the prevailing repo charge ranging from January 31, 2024,” the RBI stated on Tuesday.
At current, the repo charge – the speed at which the RBI lends funds to banks – is at 6.50%.
The RBI stated that the incremental restrict for particular person standalone major sellers will likely be conveyed to them individually. The Standing Liquidity Facility is a collateralised liquidity facility supplied by the RBI to standalone major sellers.
Major sellers (PDs) are entities which perform as market-makers within the authorities securities market, which means that these gamers are mandated to purchase and promote securities to make sure market depth. PDs are of two sorts – these which are a part of a financial institution and people which are standalone.
As on January 29, the liquidity deficit – measured by the quantum banks borrowed from the RBI – was at Rs 2.7 trillion, central financial institution knowledge confirmed.
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