SDF Parking Hits ₹4.13 Trillion Record at RBI
Why in the news
With system liquidity in surplus at the start of FY26, banks deposited a record ₹4.13 trillion at RBI’s Standing Deposit Facility (SDF) on Thursday, the biggest amount since the facility began in April 2022.
About the SDF
- A tool to absorb excess liquidity; banks park surplus funds with RBI without collateral, overnight.
- Rate: 6.00%, that is 25 bps below the repo rate of 6.25%, yet better than WACR and TREPS.
Why banks use it more
- Lower overnight rates: call money and TREPS slipped under 6%.
- Bigger government cash balances created temporary surplus.
- No counterparty risk compared with lending in the market.
- At quarter-end, foreign banks often park big rupee sums for currency management and compliance.
Data snapshot
| Item | Figure |
|---|---|
| SDF parking | ₹4.13 trillion |
| LAF surplus | ₹2.16 trillion |
| Forex reserves (March 28) | $665.4 billion |
| Latest weekly rise | $6.6 billion |
| Rise over the three weeks before | $20.1 billion |
| Rupee gain, week-on-week | 0.6% |
Other points
- RBI also uses dollar-rupee swaps, OMOs and variable rate repo auctions.
- Reserves rose due to RBI intervention and valuation changes from rupee appreciation; this is a near 5-month high.
- Experts caution that the surplus may be short-lived.
Exam angle
- SDF launched: April 2022; rate sits 25 bps under repo.
- Forex reserves: $665.4 billion, fourth weekly rise.