Current · Source: Reserve Bank of India · RBI/2008-09/287 · issued 17 Nov 2008 · ~2 min read
Quick answerRBI extends the special 14-day fixed rate repo facility until end-March 2009, with a cumulative outstanding limit of Rs 60,000 crore, for banks and Primary Dealers to meet liquidity needs of MFs and NBFCs.
The rule, in the simplest words
RBI (the country's central bank) lets banks borrow money for 14 days at a fixed cheap rate until March 2009.
Banks can borrow up to a total of Rs 60,000 crore (a very large amount) across all banks combined.
This borrowed money must be used only to help Mutual Funds (investment pools) and NBFCs (finance companies that lend money).
Banks can use this facility only if they have spare room in their SLR (the portion of deposits they must keep in safe assets) up to 1.5% of their deposits.
How it plays out — a real example
A treasury officer in Indore notices that a local NBFC is struggling to get funds. She checks her bank's SLR headroom and finds they have enough spare room. She participates in the daily RBI auction, borrows Rs 10 crore at the fixed repo rate, and lends it to the NBFC, ensuring the NBFC can continue giving loans to small businesses.
What changed
The special term repo facility, initially announced on November 3, 2008, is now extended until end-March 2009. Banks can avail this facility on an incremental or rollover basis within their 1.5% of NDTL SLR relaxation entitlement, exclusively for MFs and NBFCs. RBI will conduct daily 14-day term repos up to a cumulative outstanding amount of Rs 60,000 crore.
What it means for you
Banks get continued access to cheap liquidity from RBI at the prevailing repo rate to support mutual funds and NBFCs, easing stress in these sectors. The daily auction mechanism ensures transparent allocation, and the Rs 60,000 crore cap provides a clear ceiling on total support. This extension signals RBI's commitment to maintaining financial stability through the global crisis period.
What you must do
Assess your bank's SLR headroom up to 1.5% of NDTL for availing this facility.
Identify MF and NBFC clients needing liquidity support and plan incremental or rollover borrowing.
Participate in daily 14-day term repo auctions as per RBI press releases for rate and notified amount.
Ensure funds availed are used exclusively for meeting liquidity requirements of MFs and NBFCs.
What is the maximum amount I can borrow under this special repo?
The facility has a cumulative outstanding limit of Rs 60,000 crore across all banks. Each bank's individual entitlement is up to 1.5% of its NDTL, as per the SLR relaxation.
Can I use this facility for purposes other than MFs and NBFCs?
No, the funds must be used exclusively for meeting the liquidity requirements of mutual funds and NBFCs.
How long will this facility be available?
The facility is available daily until end-March 2009, with 14-day tenor repos conducted each day.
📜 Read the original circular — full text as issued by RBI
RBI/2008-09/287
FMD.MOAG. No. 30/01.01.001/2008-09
November 17, 2008
All Scheduled Commercial Banks (excluding RRBs)
and Primary Dealers
Dear Sir,
SPECIAL FIXED RATE REPO UNDER LIQUIDITY ADJUSTMENT FACILITY
Please refer to our circular FMD.MOAG. No. 29/01.01.01/2008-09 dated November 3, 2008 allowing banks to avail liquidity support under the LAF at the extant repo rate through relaxation in the maintenance of SLR to the extent of up to 1.5 per cent of their NDTL and apportioning such accommodation between Mutual Funds (MFs) and Non-Banking Financial Companies (NBFCs) flexibly as per their business requirements.
2. As announced on November 15, 2008, the special term repo facility will continue till end-March 2009. Banks can avail of this facility either on incremental or on rollover basis (within their 1.5% of NDTL entitlement) exclusively for meeting the liquidity requirements of MFs and NBFCs.
3. Accordingly, Reserve Bank shall conduct the special fixed rate term repo of 14 days’ tenor daily till end-March 2009 up to a cumulative amount of Rs 60,000 crore on outstanding basis. As hitherto, the details of the repo including the rate, the notified amount and the date of reversal shall be announced each day through a press release.
4. The other terms and conditions for the special repo would remain as notified by our earlier circulars on the Liquidity Adjustment Facility.
Yours faithfully,
(Chandan Sinha)
Chief General Manager
Reproduced for reference with acknowledgment — Source: Reserve Bank of India · RBI/2008-09/287 · issued 17 Nov 2008. The plain-English explanation above is BankPulse’s own independent summary.
Example: if you are a Compliance officer at a bank this circular applies to (All Scheduled Commercial Banks (excluding RRBs), Primary Dealers, Mutual Funds, Non-Banking Financial Companies (NBFCs)), your first concrete step on “Special Fixed Rate Repo Extended Till March 2009” is: “Assess your bank's SLR headroom up to 1.5% of NDTL for availing this facility.” (RBI issued this 17 Nov 2008).
Circular: RBI/2008-09/287 -- Special Fixed Rate Repo Extended Till March 2009
Issued: 17 Nov 2008
Action required: Assess your bank's SLR headroom up to 1.5% of NDTL for availing this facility.
Action required: Identify MF and NBFC clients needing liquidity support and plan incremental or rollover borrowing.
Action required: Participate in daily 14-day term repo auctions as per RBI press releases for rate and notified amount.
Action required: Ensure funds availed are used exclusively for meeting liquidity requirements of MFs and NBFCs.
Owner: ____________ Target date: ____________
Board/committee approval needed? Y / N
Evidence filed in compliance register on: ____________
Built only from this circular’s own published fields — not legal advice; always confirm against the official RBI source.
💬 Banker Discussion
Discuss this circular with fellow bankers — reply, upvote what helps, report what doesn’t belong. Be professional; no client data. Views are the commenter’s own, not BankPulse’s.
BankPulse Compliance Evidence Pack — generated 05 Aug 2026 · status cross-checked against RBI’s official withdrawal register (refreshed weekly). Official RBI source: https://www.rbi.org.in/Scripts/NotificationUser.aspx?Id=4646&Mode=0 — Plain-English summary by BankPulse (bankpulse.ai), reviewed by our expert reviewer, CA Amit Jain. Independent platform, not affiliated with the Reserve Bank of India; is our own plain-English paraphrase, not RBI’s original wording.
Help us keep this accurate
Found an inaccuracy or have an improvement? Tell us. Every report is reviewed by our team before any change is made — nothing goes live unverified.
Public beta — plain-English informational summaries. Always verify against the official RBI source (circular number cited on every page) before making compliance, credit, treasury, audit, or operational decisions. · Join our WhatsApp channel ↗
BANKPULSE · FREE DAILY BRIEF
Get RBI updates for your role
Every important RBI update, decoded in plain English — for your career, exams & financial awareness.
We collect only your email, name and role, used solely to send your brief — never sold or shared. Withdraw anytime via the unsubscribe link in any email. Independent platform, not affiliated with the RBI. Information, not legal advice.
REPORT AN ERROR · BETA
Spotted an error? Earn 500 BankPulse Credits
Help us stay accurate. If your correction is verified true and approved by our founder, you earn 500 BankPulse Credits — redeemable when the platform monetises.
Reviewed by a human before any credit is awarded. We never change the site from crowd input without verification.
WANT A NEW FEATURE · BETA
What would make BankPulse more useful for you?
Tell us what to build next — a tool, a data view, a role page, anything. We read every suggestion.
Thank you — your ideas directly shape what we build.