**Policy Summary:**
This notification, RBI/2017-2018/31 FMOD.MAOG. No. 12201.18.001/2017-18, issued by the Reserve Bank of India (RBI) on August 2, 2017, pertains to an adjustment in the Marginal Standing Facility (MSF) rate. Following the decision by the Monetary Policy Committee (MPC) to reduce the Repo rate under the Liquidity Adjustment Facility (LAF) by 25 basis points, from 6.25 percent to 6.0 percent, the MSF rate is consequently adjusted to 6.25 percent, effective immediately. All other terms and conditions of the existing MSF scheme remain unchanged. Inquiries can be directed to Radha Shyam Ratho, Chief General Manager, Financial Markets Operation Department, Central Office, at cgmfmod@rbi.org.in, or by phone at 22610642, or fax at 22630981. The central office is located at 1st Floor, Main Building, Shahid Bhagat Singh Road, Fort, Mumbai-400 001, India. This notification is applicable to all Scheduled Commercial Banks excluding Regional Rural Banks (RRBs).
Key Entities Referenced
Marginal Standing Facility: A facility under which scheduled commercial banks can borrow additional amounts of overnight money from the Reserve Bank of India (RBI).
Scheduled Commercial Banks: Banks in India that are listed in the Second Schedule to the Reserve Bank of India Act, 1934.
Monetary Policy Committee: A committee of the Reserve Bank of India (RBI) that is responsible for setting the benchmark interest rate.
Repo rate: The rate at which the Reserve Bank of India (RBI) lends money to commercial banks against the collateral of government securities.
Liquidity Adjustment Facility: A tool used by the Reserve Bank of India (RBI) to manage liquidity in the money market.
Mumbai, Maharashtra: Location of the Central Office of the Financial Markets Operation Department, Reserve Bank of India (RBI).
Radha Shyam Ratho: Chief General Manager, Financial Markets Operation Department, Reserve Bank of India (RBI).
Reserve Bank of India Act, 1934: The legislation under which the Reserve Bank of India was established and operates.
RBI/2017-2018/31
FMOD.MAOG. No. 122/01.18.001/2017-18
August 2, 2017
All Scheduled Commercial Banks (excluding RRBs)
Madam / Sir,
Marginal Standing Facility
As announced in the Third Bi-monthly Monetary Policy Statement, 2017-18, today, it has
been decided by the Monetary Policy Committee (MPC) to reduce the Repo rate under the
Liquidity Adjustment Facility (LAF) by 25 basis points from 6.25 per cent to 6.0 per cent
with immediate effect.
Consequent to the change in the Repo rate, the Marginal Standing Facility (MSF) rate
stands adjusted to 6.25 per cent with immediate effect.
All other terms and conditions of the extant MSF scheme will remain unchanged.
Yours sincerely
(Radha Shyam Ratho)
Chief General Manager
Financial Markets Operation Department, Central Office, 1st Floor, Ma in Building, Shahid Bhagat Singh Road, Fort, Mumbai-400 001, India
Tel : 22610642 Fax No:22630981 E-Mail : cgmfmod@rbi.org.in