Banks Park Record ₹4.13 Trn in Standing Deposit Facility

As the banking system liquidity moves into surplus and with limited credit offtake at the start of the financial year 2025-26 (FY26), commercial banks on Thursday parked ₹4.13 trillion with the Reserve Bank of India (RBI) under the standing deposit facility (SDF).

- ANUPREKSHA JAIN

This marked the highest amount banks have parked in the SDF since its introduction in April 2022.

SDF allows banks to deposit surplus funds with the central bank without the need for collateral at a rate of 25 basis points (bps) lower than the repo rate, which is 6.25 per cent now. SDF, which is an overnight facility, is available between 5.30 pm and 11.59 pm on all days, including Sundays and holidays, and the funds are reversed on the following working day.

With continuous infusion of funds in the banking system by the central bank, overnight rates such as weighted average call rate (WACR) and tri-party repo rate (TREPS) have fallen below 6 per cent, prompting banks to park funds under the SDF facility at 6 per cent, said dealers.