**Summary:**
This circular, reference RBI20162017269 FMOD.MAOG. No.11901.18.001201617, dated April 6, 2017, issued by the Reserve Bank of India (RBI) to all Scheduled Commercial Banks excluding Regional Rural Banks (RRBs), announces an adjustment to the Marginal Standing Facility (MSF) rate. Following the First Bimonthly Monetary Policy Statement, 2017-18, and the Monetary Policy Committee (MPC) resolution to narrow the Liquidity Adjustment Facility (LAF) corridor, the MSF rate is revised to 6.50 percent. All other terms and conditions of the existing MSF scheme remain unchanged. Radha Shyam Ratho, Chief General Manager, is the point of contact for this communication.
Key Entities Referenced
Reserve Bank of India: The issuing authority of the notification, responsible for monetary policy in India.
Marginal Standing Facility (MSF): A facility under which scheduled commercial banks can borrow overnight funds from the Reserve Bank of India against government securities.
Scheduled Commercial Banks: Banks included in the Second Schedule to the Reserve Bank of India Act, 1934.
Regional Rural Banks (RRBs): Regional Rural Banks are financial institutions in India which operate at a regional level.
Monetary Policy Committee (MPC): A committee of the Reserve Bank of India that is responsible for setting monetary policy.
LAF corridor: Liquidity Adjustment Facility corridor. It refers to the width between the reverse repo rate and the marginal standing facility (MSF) rate.
Radha Shyam Ratho: Chief General Manager at Reserve Bank of India.
RBI/2016-2017/269
FMOD.MAOG. No.119/01.18.001/2016-17 April 6, 2017
All Scheduled Commercial Banks (excluding RRBs)
Madam / Sir,
Marginal Standing Facility
As announced in the First Bi-monthly Monetary Policy Statement, 2017-18 Resolution of the
Monetary Policy Committee (MPC), consequent upon the narrowing of the LAF corridor, the
Marginal Standing Facility (MSF) rate now stands adjusted at 6.50 per cent.
All other terms and conditions of the current MSF scheme will remain unchanged.
Yours sincerely
(Radha Shyam Ratho)
Chief General Manager