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Repo Rate Hiked to 8.25%: Standing Liquidity Facilities Priced Higher

Current · Source: Reserve Bank of India · RBI/2011-12/181 · issued 16 Sep 2011 · ~2 min read

Quick answerRBI raised the repo rate by 25 bps to 8.25% effective September 16, 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

The RBI (India's central bank) raised the repo rate (the interest rate at which banks borrow money from RBI) from 8.00% to 8.25% starting September 16, 2011.
Banks and Primary Dealers (companies that buy and sell government bonds) now have to pay 8.25% interest when they borrow money from RBI under special emergency loan programs (standing liquidity facilities).
This higher rate applies to export credit refinance (special loans for banks that give export loans) and collateralised liquidity support (loans backed by bonds) for Primary Dealers.
The rate hike makes it more expensive for banks to get money from RBI, so banks may charge higher interest on loans they give to people and businesses.

How it plays out — a real example

A forex & trade-finance officer in Indore, Priya, checks her bank's daily funding costs and sees that the RBI's repo rate has jumped to 8.25%. She immediately calls her treasury team to update the interest rate on the export credit refinance her bank uses, knowing that any new loans for exporters must now factor in this higher cost to keep the bank profitable.

What changed

The repo rate under the Liquidity Adjustment Facility (LAF) was increased by 25 basis points from 8.00% to 8.25% with immediate effect. Standing liquidity facilities provided to banks (export credit refinance) and Primary Dealers (collateralised liquidity support) are now priced at the new repo rate of 8.25%.

What it means for you

Banks and Primary Dealers will face higher costs for accessing standing liquidity from the RBI, as the rate for export credit refinance and collateralised liquidity support has risen in line with the repo rate hike. This move signals tighter monetary policy, potentially increasing lending rates and reducing liquidity in the banking system.

What you must do

Review and adjust your bank's funding costs to reflect the higher repo rate on standing liquidity facilities.
Communicate the revised rate to treasury and credit teams for accurate pricing of loans and advances.
Assess the impact on export credit refinance availed and plan for any changes in liquidity management.
Monitor RBI's future policy actions to anticipate further rate adjustments.

Who it affects

All Scheduled Banks (excluding Regional Rural Banks), Primary Dealers, Treasury departments of banks, Export credit borrowers

❓ Common questions

Regulatory timeline

Stated effective date effective September 16, 2011
Decoded by BankPulse 2026-06-18 23:31 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 September 16, 2011?

The repo rate under the Liquidity Adjustment Facility (LAF) has been increased by 25 basis points from 8.00% to 8.25% with immediate effect.

How does this affect standing liquidity facilities for banks?

Standing liquidity facilities, including export credit refinance for banks and collateralised liquidity support for Primary Dealers, will now be available at the revised repo rate of 8.25%.

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

No, this circular is addressed to all Scheduled Banks excluding Regional Rural Banks (RRBs) and Primary Dealers.

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

RBI/2011-12/181 

 REF.No.MPD.BC.348/07.01.279/2011-12 

 September 16, 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 of September 16, 2011 , in terms of which the repo rate under the Liquidity Adjustment Facility (LAF) has been increased by 25 basis points from 8.00 per cent to 8.25 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 8.25 per cent with effect from September 16, 2011.

 Yours faithfully,

 (Janak Raj)

 Adviser-in-Charge

Reproduced for reference with acknowledgment — Source: Reserve Bank of India · RBI/2011-12/181 · issued 16 Sep 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 rate to treasury and credit teams for accurate pricing of loans and advances.

📜 Compliance

Review and adjust your bank's funding costs to reflect the higher repo rate on standing liquidity facilities.
Assess the impact on export credit refinance availed and plan for any changes in liquidity management.
Monitor RBI's future policy actions to anticipate further rate adjustments.

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 Regional Rural Banks), Primary Dealers, Treasury departments of banks, Export credit borrowers), your first concrete step on “Repo Rate Hiked to 8.25%: Standing Liquidity Facilities Priced Higher” is: “Review and adjust your bank's funding costs to reflect the higher repo rate on standing liquidity facilities.” (RBI issued this 16 Sep 2011).

Circular: RBI/2011-12/181 -- Repo Rate Hiked to 8.25%: Standing Liquidity Facilities Priced Higher
Issued: 16 Sep 2011
Action required: Review and adjust your bank's funding costs to reflect the higher repo rate on standing liquidity facilities.
Action required: Communicate the revised rate to treasury and credit teams for accurate pricing of loans and advances.
Action required: Assess the impact on export credit refinance availed and plan for any changes in liquidity management.
Action required: Monitor RBI's future policy actions to anticipate further rate adjustments.
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=6711&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.