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Call Money Borrowing Limit for Stand-alone PDs Raised to 225% of NOF

Current · Source: Reserve Bank of India · RBI/2009-10/143 · issued 02 Sep 2009 · ~1 min read
Quick answerRBI increased the average fortnightly borrowing limit for stand-alone Primary Dealers from 200% to 225% of their Net Owned Funds as of end-March of the previous financial year, effective immediately.
The rule, in the simplest words
How it plays out — a real example

A treasury officer named Rohan at a primary dealer in Mumbai checks the call‑money borrowing ledger. Seeing that his team has been borrowing 210% of NOF, he quickly adjusts the borrowing plan to 225% to take advantage of the new limit, ensuring the firm stays compliant while improving liquidity.

What changed

Previously, stand-alone Primary Dealers could borrow from the call/notice money market up to 200% of their Net Owned Funds on average in a reporting fortnight. This circular raises that ceiling to 225% of NOF, effective from the date of the circular.

What it means for you

Stand-alone PDs now have greater flexibility to access short-term funds, which can help them manage liquidity more efficiently. The 25 percentage point increase provides additional headroom for leveraging their capital base in the money market.

What you must do

Who it affects

Stand-alone Primary Dealers, Treasury departments of PDs, Compliance teams at PDs

❓ Common questions

What is the new borrowing limit for stand-alone Primary Dealers in the call/notice money market?

The limit has been increased from 200% to 225% of their Net Owned Funds as at end-March of the preceding financial year, calculated on an average basis over a reporting fortnight.

When does this revised limit take effect?

The revised limit is effective from the date of the circular, i.e., September 2, 2009.

📜 Read the original circular — full text as issued by RBI
RBI/2009-10/143 IDMD.PDRD.No. 1096/ 03.64.00/2009-10 September 2, 2009 All Stand-alone Primary Dealers Dear Sir, Stand-alone Primary Dealers - Increase in Call/Notice Money Borrowing Limit Please refer to our Master Circular RBI/2009-10/56 IDMD.PDRS. 01 /03.64.00/2009-10 dated July 1, 2009 on Operational Guidelines to Primary Dealers, in terms of which, Primary Dealers( PDs) are allowed to borrow from call/notice money market, on an average in a reporting fortnight, up to 200 percent of their Net Owned Funds (NOF) as at the end March of the preceding financial year. 2. On a review, it has been decided to increase the limit on borrowing by the PDs from the call / notice money market, on an average in a reporting fortnight, from the existing ceiling of 200 percent of their NOF to 225 percent of NOF, as at the end March of the preceding financial year. 3. The above guidelines are effective from the date of this circular. Yours faithfully (R. N. Kar) General Manager
Reproduced for reference with acknowledgment — Source: Reserve Bank of India · RBI/2009-10/143 · issued 02 Sep 2009. The plain-English explanation above is BankPulse’s own independent summary.
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Who does what — compliance checklist
💻 IT / Systems
  • Update internal treasury and risk management systems to reflect the new 225% of NOF borrowing limit.
📜 Compliance
  • Review current call/notice money borrowing levels to ensure compliance with the revised ceiling.
  • Communicate the change to relevant treasury and compliance teams for immediate implementation.
Grouped from the action items above — a single circular may involve more than one team.
Worked example & action-note template

Example: if you are an IT/Systems lead at a bank this circular applies to (Stand-alone Primary Dealers, Treasury departments of PDs, Compliance teams at PDs), your first concrete step on “Call Money Borrowing Limit for Stand-alone PDs Raised to 225% of NOF” is: “Update internal treasury and risk management systems to reflect the new 225% of NOF borrowing limit.” (RBI issued this 02 Sep 2009).

  1. Circular: RBI/2009-10/143 -- Call Money Borrowing Limit for Stand-alone PDs Raised to 225% of NOF
  2. Issued: 02 Sep 2009
  3. Action required: Update internal treasury and risk management systems to reflect the new 225% of NOF borrowing limit.
  4. Action required: Review current call/notice money borrowing levels to ensure compliance with the revised ceiling.
  5. Action required: Communicate the change to relevant treasury and compliance teams for immediate implementation.
  6. Owner: ____________ Target date: ____________
  7. Board/committee approval needed? Y / N
  8. 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.

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Official RBI source: https://www.rbi.org.in/Scripts/NotificationUser.aspx?Id=5249&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.
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