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RBI to Operationalise SDF

Published on April 12, 2022
Current Context: RBI has taken a game-changer decision to replace the reverse repo with Standing Deposit Facility (SDF).
RBI to Operationalise SDF
  • RBI has come up with SDF as a replacement to reverse repo. While Reverse Repo is a tool to absorb liquidity from the market by RBI with collateral as a payment to the Scheduled Commercial Banks (SCBs), SDF on the other hand does not require any collateral.
  • The idea of the Standing Deposit Facility was given by the Urjit Patel Committee in 2014.
  • It was later introduced via Finance Bill 2018. Like reverse repo, SDF has also pegged 25 basis points below the Repo rate.


Q.1 Which committee recommended the introduction of the Standing Deposit Facility?
a. Vijay Kelkar Committee
b. L. K Jha Committee
c. Urjit Patel Committee
d. Bimal Jalan Committee
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