Current · Source: Reserve Bank of India · RBI/2012-2013/447 · issued 19 Mar 2013 · ~1 min read
Quick answerRBI cut the repo rate by 25 basis points to 7.50% effective immediately. Reverse repo and MSF rates adjusted automatically to 6.50% and 8.50% respectively. All other LAF and MSF terms remain unchanged.
The rule, in the simplest words
The RBI cut the repo rate by 25 basis points to 7.50% to support economic activity.
Banks can now borrow from RBI at a lower cost, which may reduce their lending rates.
The reverse repo rate and MSF rate were automatically adjusted to 6.50% and 8.50% respectively.
How it plays out — a real example
A branch operations officer in Indore, Mr. Kumar, can now offer lower interest rates to customers, encouraging them to take loans and stimulating economic growth in the region.
What changed
The repo rate under the Liquidity Adjustment Facility was reduced by 25 basis points from 7.75% to 7.50%, effective March 19, 2013. Consequently, the reverse repo rate adjusted to 6.50% and the Marginal Standing Facility rate to 8.50%. No other terms of the LAF or MSF schemes were altered.
What it means for you
Banks can now borrow from RBI at a lower cost, which may reduce their lending rates and encourage credit growth. The automatic adjustments to reverse repo and MSF rates ensure the interest rate corridor remains consistent. This move signals RBI's intent to support economic activity amid the mid-quarter review.
What you must do
Update your treasury systems and internal lending rate benchmarks to reflect the new repo rate of 7.50%.
Communicate the rate change to your asset-liability management (ALM) team for liquidity planning.
Review your loan pricing models to assess potential pass-through to customers.
Monitor the impact on your net interest margin and adjust deposit rates if needed.
Who it affects
All scheduled commercial banks (excluding RRBs), Primary dealers, Treasury departments, ALM teams
❓ Common questions
Regulatory timeline
Stated effective dateeffective March 19, 2013
Decoded by BankPulse2026-06-18 16:03 IST
Built from our lineage records — each fact carries its provenance; missing history simply is not shown (never guessed).
When did this repo rate cut take effect?
The cut was announced on March 19, 2013, and took effect immediately from that date.
What are the new reverse repo and MSF rates?
The reverse repo rate is now 6.50% and the MSF rate is 8.50%, both adjusted automatically following the repo rate change.
Are there any other changes to LAF or MSF schemes?
No, all other terms and conditions of the LAF and MSF schemes remain unchanged as per the notification.
📜 Read the original circular — full text as issued by RBI
RBI/2012-2013/447
FMD.MOAG. No. 76 /01.01.01/2012-13
March 19, 2013
All Scheduled Commercial Banks (excluding RRBs) and Primary Dealers
Madam / Sir,
Liquidity Adjustment Facility – Repo and Reverse Repo
and Marginal Standing Facility Rates
As announced today in the Mid-Quarter Review of the Monetary Policy 2012-13 , it has been decided to reduce the Repo rate under the Liquidity Adjustment Facility (LAF) by 25 basis points from 7.75 per cent to 7.50 per cent with immediate effect.
2. Consequent to the change in the Repo rate, the Reverse Repo rate under the LAF and the Marginal Standing Facility (MSF) rate will stand automatically adjusted to 6.50 per cent and 8.50 per cent respectively with immediate effect.
3. All other terms and conditions of the current LAF and MSF schemes will remain unchanged.
4. Please acknowledge receipt.
Yours sincerely
(G. Mahalingam)
Chief General Manager
Reproduced for reference with acknowledgment — Source: Reserve Bank of India · RBI/2012-2013/447 · issued 19 Mar 2013. The plain-English explanation above is BankPulse’s own independent summary.
Update your treasury systems and internal lending rate benchmarks to reflect the new repo rate of 7.50%.
📜 Compliance
Communicate the rate change to your asset-liability management (ALM) team for liquidity planning.
Review your loan pricing models to assess potential pass-through to customers.
Monitor the impact on your net interest margin and adjust deposit rates if needed.
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 (All scheduled commercial banks (excluding RRBs), Primary dealers, Treasury departments, ALM teams), your first concrete step on “Repo Rate Cut by 25 bps to 7.50%” is: “Update your treasury systems and internal lending rate benchmarks to reflect the new repo rate of 7.50%.” (RBI issued this 19 Mar 2013).
Circular: RBI/2012-2013/447 -- Repo Rate Cut by 25 bps to 7.50%
Issued: 19 Mar 2013
Action required: Update your treasury systems and internal lending rate benchmarks to reflect the new repo rate of 7.50%.
Action required: Communicate the rate change to your asset-liability management (ALM) team for liquidity planning.
Action required: Review your loan pricing models to assess potential pass-through to customers.
Action required: Monitor the impact on your net interest margin and adjust deposit rates if needed.
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 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=7897&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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