@NarendraModi government eyes new monetary facility to suck up excess cash in the banking system

The government is exploring the possibility of a new monetary facility – standing deposit facility – to suck up excess cash in the banking system, reports Banikinkar Pattanayak in New Delhi. The discussion featured prominently in a meeting of senior finance ministry officials with bankers on Friday, sources told FE. There was an unusual surge in deposits following demonetisation in November, triggering calls for fresh instruments to reduce the excess cash flows. The meeting discussed the possibility of such a facility that would absorb excess cash with banks at a rate lower than the repo rate, sources said.