 "mutual funds")
The Reserve Bank of India's (RBI's) liquidity support for mutual funds could struggle to be effective, as its success would hang on banks' appetite to take up the risks involved, amid a low capital headroom and a likely increase in fresh non-performing loans, according to Fitch.
The RBI's Rs 50,000-crore Special Liquidity Facility for Mutual Funds (SLF-MF) will provide a 90-day repo funding to banks, to extend liquidity to — or purchase of commercial paper and debt securities from — local mutual funds.
The size of the SLF-MF appears broadly commensurate with the scale of the funds most at risk,
