The terms ‘Marginal Standing Facility Rate’ and ‘Net Demand and Time Liabilities’, sometimes appearing in news, are used in relation to
[UPSC Civil Services Exam – 2014 Prelims]
(a) banking operations
(b) communication networking
(c) military strategies
(d) supply and demand of agricultural products
- The Marginal Standing Facility (MSF) is a facility provided by the Reserve Bank of India (RBI) that enables banks to borrow funds overnight against approved government securities.
- Banks can borrow up to a certain percentage of their net demand and time liabilities (NDTL) through MSF.
- This facility serves as a mechanism for banks to access funds from the RBI during emergency situations when inter-bank liquidity becomes scarce or completely dries up.