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Question

The terms 'Marginal Standing Facility Rate' and 'Net Demand and Time Liabilities', sometimes appearing in news, are used in relation to
(a) banking operations
(b) communication networking
(c) military strategies
(d) supply and demand of agricultural products

Answer:

A

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Explanation:

The terms 'Marginal Standing Facility Rate' (MSF Rate) and 'Net Demand and Time Liabilities' (NDTL) are related to banking operations in India.

Marginal Standing Facility Rate (MSF Rate): It is the interest rate at which commercial banks in India can borrow funds overnight from the Reserve Bank of India (RBI) against approved government securities. It is a tool used by the RBI to control short-term liquidity in the banking system.

Net Demand and Time Liabilities (NDTL): It refers to the aggregate deposits held by commercial banks, including demand deposits (such as current and savings accounts) and time deposits (such as fixed deposits) minus the deposits held by the banks with the RBI. NDTL is an important factor in determining banks' reserve requirements and liquidity management.

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