**Policy Summary:**
This circular, DOR.No.Ret.BC.7712.02.001/2019-20, issued by the Reserve Bank of India (RBI) on June 26, 2020, addresses the Statutory Liquidity Ratio (SLR) and Marginal Standing Facility (MSF) for all Scheduled Banks excluding Regional Rural Banks. It pertains to Section 24 of the Banking Regulation Act, 1949. The circular extends the enhanced borrowing limit for scheduled banks under the MSF scheme, allowing them to dip into the prescribed SLR by up to 3% of their Net Demand and Time Liabilities (NDTL) outstanding at the end of the second preceding fortnight. This enhanced limit, initially set to expire on June 30, 2020, is now extended until September 30, 2020. Banks can continue to access overnight funds under the MSF against their excess SLR holdings, as per circular FMD.No.6501.18.001/11-12 dated December 21, 2011. For further information, contact Dr. S. K. Kar, Chief General Manager, Department of Regulation, Central Office, RBI at Tel No: 22603000. The central office is located on the 5th floor, Amar Building, Sir P.M. Road, Fort, Mumbai - 400001.
Key Entities Referenced
Reserve Bank of India: The central bank of India, responsible for regulating the banking sector.
Banking Regulation Act, 1949: An act of the Parliament of India to regulate banking companies in India.
Statutory Liquidity Ratio (SLR): The minimum percentage of deposits that a commercial bank has to maintain in the form of liquid assets.
Marginal Standing Facility (MSF): A facility under which scheduled commercial banks can borrow additional amount of overnight money from the Reserve Bank of India.
Regional Rural Banks: Indian Scheduled Commercial Banks operating at regional level in different States of India.
Net Demand and Time Liabilities (NDTL): The difference between the sum of demand and time liabilities (deposits) of a bank and its interbank assets.
Dr. S K Kar: Chief General Manager, Department of Regulation, Reserve Bank of India.
Mumbai, Maharashtra: Location of the Central Office of the Department of Regulation, Reserve Bank of India.
भारतीय �रज़व र् बक�
______________________RESERVE BANK OF INDIA ______________________
www.rbi.org.in
RBI/2019-20/259
DOR.No.Ret.BC.77/12.02.001/2019-20 June 26, 2020
All Scheduled Banks (excluding Regional Rural Banks)
Dear Sir / Madam
Section 24 of the Banking Regulation Act, 1949 – Maintenance of Statutory Liquidity
Ratio (SLR) – Marginal Standing Facility (MSF)
Please refer to our circular DOR.No.Ret.BC.52/12.01.001/2019-20 dated March 27, 2020 on
Marginal Standing Facility (MSF) Scheme.
2. As announced in the Statement of Developmental and Regulatory Policies dated March
27, 2020, the borrowing limit of scheduled banks under the MSF scheme, by dipping into the
prescribed SLR, was increased from 2 per cent to 3 per cent of their Net Demand and Time
Liabilities (NDTL) outstanding at the end of the second preceding fortnight with immediate
effect. This relaxation was available up to June 30, 2020.
3. On a review, it has now been decided to extend this enhanced limit till September 30, 2020.
4. Banks may continue to access overnight funds under the MSF against their excess SLR
holding as advised in our circular FMD.No.65/01.18.001/11-12 dated December 21, 2011.
Yours faithfully
(Dr. S K Kar)
Chief General Manager
िविनयमन िवभाग, क�द्रीय काया�लय, 5वी ं मंिजल, अमर भवन, सर पी एम रोड, फोट�, मुंबई 400001
___________________________________________________________________________________________________________________
टेलीफ़ोन /Tel No: 22603000
Department of Regulation, Central Office, 5th floor, Amar Building, Sir P.M. Road, Fort, Mumbai – 400001.
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