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Repo Rate Hiked to 6.75%: Standing Liquidity Facilities Costlier

Current · Source: Reserve Bank of India · RBI/2010-11/436 · issued 17 Mar 2011 · ~1 min read

Quick answerRBI raised the repo rate by 25 bps to 6.75% effective March 17, 2011. Consequently, standing liquidity facilities for banks (export credit refinance) and Primary Dealers (collateralised liquidity support) will now be available at the revised repo rate.

The rule, in the simplest words

RBI raised the repo rate (the interest rate banks pay to borrow from RBI) by 25 basis points to 6.75% on March 17, 2011.
Standing liquidity facilities (ongoing borrowing options) for banks (export credit refinance) and Primary Dealers (collateralised liquidity support) are now priced at the new repo rate of 6.75%.
Banks and Primary Dealers will pay more to borrow, which can increase their costs and may lead to higher loan rates for customers.
The rate hike shows RBI is tightening policy to keep inflation under control.
Banks should review how much they use export credit refinance, adjust their asset‑liability management, and inform teams about the new rate.

How it plays out — a real example

A treasury officer named Rohan at a scheduled bank in Indore sees the repo rate jump to 6.75%. He checks how much the bank uses export credit refinance, calculates the extra cost, and tells the loan desk to adjust interest rates on new gold loans so customers are not hit too hard.

What changed

The repo rate under the Liquidity Adjustment Facility (LAF) was increased by 25 basis points from 6.50% to 6.75% with immediate effect. Standing liquidity facilities for banks (export credit refinance) and Primary Dealers (collateralised liquidity support) are now priced at the new repo rate of 6.75%.

What it means for you

Banks and Primary Dealers will face higher borrowing costs for these standing facilities, directly impacting their liquidity management and net interest margins. This rate hike signals RBI's tightening stance to contain inflation, potentially leading to higher lending rates for end customers.

What you must do

Review your bank's reliance on export credit refinance and assess the impact of the 25 bps hike on funding costs.
Adjust your asset-liability management (ALM) strategies to account for higher cost of standing liquidity facilities.
Communicate the revised repo rate to treasury and credit teams for updated pricing of loans and advances.
Monitor RBI's future policy actions to anticipate further rate changes and plan liquidity buffers accordingly.

Who it affects

All scheduled banks (excluding RRBs), Primary Dealers, Treasury departments of banks, Export credit borrowers (indirectly through higher refinance costs)

❓ Common questions

Regulatory timeline

Stated effective date effective March 17, 2011
Decoded by BankPulse 2026-06-19 02:12 IST

Built from our lineage records — each fact carries its provenance; missing history simply is not shown (never guessed).

What is the new repo rate effective from March 17, 2011?

The repo rate under the Liquidity Adjustment Facility (LAF) has been increased by 25 basis points from 6.50% to 6.75% with immediate effect.

Which standing liquidity facilities are affected by this change?

The standing liquidity facilities for banks (export credit refinance) and Primary Dealers (collateralised liquidity support) are now available at the revised repo rate of 6.75%.

Are Regional Rural Banks (RRBs) covered by this notification?

No, the notification explicitly excludes Regional Rural Banks (RRBs) from its scope.

📜 Read the original circular — full text as issued by RBI

RBI/2010-11/436 

 REF.No.MPD.BC.341 /07.01.279/2010-11 

 March 17, 2011

 To

 All Scheduled Banks [excluding Regional Rural Banks (RRBs)]

and Primary Dealers

 Dear Sir/Madam,

 Standing Liquidity Facilities for 

 Banks and Primary Dealers 

 Please refer to the Mid-Quarter Monetary Policy Review dated March 17, 2011 , in terms of which the repo rate under the Liquidity Adjustment Facility (LAF) has been increased by 25 basis points from 6.50 per cent to 6.75 per cent with immediate effect.

 2.  Accordingly, the Standing Liquidity Facilities provided to banks (export credit refinance) and Primary Dealers (PDs) (collateralised liquidity support) from the Reserve Bank would be available at the revised repo rate, i.e., at 6.75 per cent with effect from March 17, 2011.

 Yours faithfully,

 (Janak Raj)

 Adviser-in-Charge

Reproduced for reference with acknowledgment — Source: Reserve Bank of India · RBI/2010-11/436 · issued 17 Mar 2011. The plain-English explanation above is BankPulse’s own independent summary.

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Who does what — compliance checklist

💻 IT / Systems

Communicate the revised repo rate to treasury and credit teams for updated pricing of loans and advances.

📜 Compliance

Review your bank's reliance on export credit refinance and assess the impact of the 25 bps hike on funding costs.
Adjust your asset-liability management (ALM) strategies to account for higher cost of standing liquidity facilities.
Monitor RBI's future policy actions to anticipate further rate changes and plan liquidity buffers accordingly.

Grouped from the action items above — a single circular may involve more than one team.

Worked example & action-note template

Example: if you are a Compliance officer at a bank this circular applies to (All scheduled banks (excluding RRBs), Primary Dealers, Treasury departments of banks, Export credit borrowers (indirectly through higher refinance costs)), your first concrete step on “Repo Rate Hiked to 6.75%: Standing Liquidity Facilities Costlier” is: “Review your bank's reliance on export credit refinance and assess the impact of the 25 bps hike on funding costs.” (RBI issued this 17 Mar 2011).

Circular: RBI/2010-11/436 -- Repo Rate Hiked to 6.75%: Standing Liquidity Facilities Costlier
Issued: 17 Mar 2011
Action required: Review your bank's reliance on export credit refinance and assess the impact of the 25 bps hike on funding costs.
Action required: Adjust your asset-liability management (ALM) strategies to account for higher cost of standing liquidity facilities.
Action required: Communicate the revised repo rate to treasury and credit teams for updated pricing of loans and advances.
Action required: Monitor RBI's future policy actions to anticipate further rate changes and plan liquidity buffers accordingly.
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.

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BankPulse Compliance Evidence Pack — generated 03 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=6295&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.