What changed
RBI issued a master circular consolidating all previous guidelines on call/notice money market operations into one document. No new rules were introduced; the circular merely updates and compiles existing instructions for easier reference.
What it means for you
Banks and primary dealers now have a single reference document for call/notice money market rules, reducing confusion from multiple circulars. The prudential limits on borrowing and lending remain unchanged, so compliance requirements stay the same. This consolidation helps streamline internal processes and audits.
What you must do
- Review the master circular to ensure your treasury operations align with the consolidated guidelines.
- Update internal policy documents and training materials to reference this master circular instead of older circulars.
- Verify that your call/notice money market transactions comply with the specified prudential limits on borrowing and lending.
- Ensure reporting formats and dealing session timings (9:00 am to 5:00 pm) are correctly followed.
Who it affects
Scheduled commercial banks (excluding RRBs), Co-operative banks (excluding Land Development Banks), Primary dealers
What are the borrowing limits for scheduled commercial banks in the call/notice money market?
On a fortnightly average basis, borrowing must not exceed 100% of capital funds (Tier I + Tier II). However, on any single day during a fortnight, borrowing can go up to 125% of capital funds.
Are non-bank institutions allowed to participate in the call/notice money market?
No, non-bank institutions other than primary dealers are not permitted to participate in the call/notice money market.
What is the dealing session for call/notice money market transactions?
Deals can be executed from 9:00 am to 5:00 pm on weekdays and from 9:00 am to 2:00 pm on Saturdays or as specified by RBI from time to time.