- 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.
Question:
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
