📢 Too many exams? Don’t know which one suits you best? Book Your Free Expert 👉 call Now!

    Question

    In India, the Marginal Standing Facility (MSF) is a tool

    used by the Reserve Bank of India (RBI) to lend to commercial banks at an overnight rate. What is the standard rate at which MSF is provided?
    A 0.25% above the repo rate Correct Answer Incorrect Answer
    B 0.50% below the repo rate Correct Answer Incorrect Answer
    C 1% above the repo rate Correct Answer Incorrect Answer
    D 1.50% above the repo rate Correct Answer Incorrect Answer
    E At par with the repo rate Correct Answer Incorrect Answer

    Solution

    MSF allows scheduled commercial banks to borrow overnight funds from RBI against government securities. The MSF rate is typically 0.25% higher than the repo rate.

    Practice Next
    More Previous year papers Questions

    Relevant for Exams:

    ask-question