The Reserve Bank of India (RBI) opened a special two-day funding window for banks through the marginal standing facility (MSF) on Saturday to help them meet liquidity needs as there would be higher demand for funds on account of advance tax payment.
On Friday, RBI had said all designated branches of agency banks would be open on Saturday and Sunday to facilitate collection of advance taxes for income tax and corporate tax.
“Given the market conditions, we have decided to offer two-day funds to banks through the marginal standing facility,” a release said.
The MSF window was open from between 5 pm and 5.30 pm and funds would be repayable on September 16.
Sunday is the last day for corporates and high income individuals to pay their advance tax.
The banks borrowed a record Rs 73,602 crore from MSF window on September 11, according to the RBI data.
The RBI has designated bank branches of State Bank of India and other public sector banks, HDFC Bank, ICICI Bank, Axis Bank, IDBI Bank and Kotak Mahindra Bank.