RBI extends enhanced borrowing limit for banks under MSF till Mar 31

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

Amid the ongoing economic woes created by the coronavirus pandemic, the Reserve Bank has decided to extend by six months the enhanced borrowing facility provided to banks to meet liquidity shortage till March 31, 2021.

The RBI, as a temporary measure, had increased the borrowing limit for scheduled banks under the marginal standing facility (MSF) scheme from 2 per cent to 3 per cent of their Net Demand and Time Liabilities (NDTL) with effect from March 27, 2020.

The facility, which was initially available up to June 30, 2020 was later extended up to September 30, 2020 in view of the disruptions