RBI to release on-tap TLTRO funds every Monday, scheme to run till Mar 31

The Reserve Bank of India (RBI) on Wednesday said banks can avail on-tap funds under the targeted long-term repo operations (TLTRO) to invest in papers issued by companies in the agriculture, agri-Infrastructure, secured retail, micro, small and medium enterprises (MSMEs), drugs, pharmaceuticals and in healthcare.
 

The on-tap TLTRO scheme will remain operational till March 31, and all banks will be eligible to participate. The RBI will be aggregating all requests received from the banks for the funds, and release funds every Monday by initiating a 3-year repo contract with the requesting bank, the central bank said in a release on its website. Multiple requests by a bank in a week will be clubbed into a single repo contract.
 

“In case the requested amount exceeds the remaining amount under the scheme on the date of operation, the remaining amount will be distributed on a pro-rata basis among all the eligible requests.”
 

The central bank had originally announced the on-tap TLTRO aggregating Rs 1 trillion in the monetary policy on October 9.
 

At the same time, the RBI allowed banks to reverse their TLTRO money taken between March 27 to to April 23. The date of repayment is between November 2 and 6. This is done so that banks can unwind the TLTRO money and borrow under the cheaper on-tap TLTRO plan.