The Reserve Bank of India vide its notification dated 21st October 2020 has announced an ‘on tap’ Targeted Long-Term Repo Operations scheme of up to Rs 1 lakh crore to enable banks to provide liquidity support to a host of sectors, including agriculture, retail, drugs and pharmaceuticals, and MSMEs.
The Scheme will remain operational from October 22, 2020, till March 31, 2021 and all banks eligible under the Liquidity Adjustment Facility (LAF) can participate in the Scheme.
Investments made by banks under this facility will be classified as held to maturity (HTM) even in excess of 25 percent of total investment permitted to be included in the HTM portfolio. All exposures under this facility will also be exempted from reckoning under the large exposure framework.
The Reserve Bank reserves the right to decide the quantum of allotment and/or accept/reject any or all the requests, either wholly/partially, without assigning any reason thereof.
