The Reserve Bank of India on Tuesday witnessed a technical glitch in the facility that it provides to banks to either deploy surplus funds or borrow money from the central bank, market participants said.
Bank treasury executives said that the central bank’s Automatic Sweep-In and Sweep-Out (ASISO) facility suffered an outage, as a result of which the funds which were either parked with the central bank or borrowed from it did not reflect on banks’ books.
Consequently, the central bank did not publish its daily money market operations data at the usual time of 9 am IST on Wednesday.
Sources aware of the development said that the RBI was working to rectify the issue and that it would reconcile the outstanding lending or borrowing of banks that were keyed into the facility before the glitch occurred.
“There was a technical issue with the ASISO facility, and the RBI is managing the situation. From the perspective of the banking system it does not pose major issues because the RBI will ensure that the relevant SDF (Standing Deposit Facility) or MSF (Marginal Standing Facility) bids that banks placed are reconciled,” a banking source said.
An email sent to the RBI seeking comment on the matter did not receive a response by the time of publication.
The ASISO facility was set up by the RBI in August 2020 amid the COVID-19 pandemic in order to make it easier for banks to manage their day-to-day liquidity operations in an automated manner amid the medical crisis.
The SDF is the window through which banks deploy excess funds with the RBI while the MSF is the window through which lenders borrow funds from the central bank to bridge shortfalls in reserve requirements. The SDF rate is 25 basis points lower than the repo rate while the MSF rate is 25 bps higher than the repo rate. The repo rate is currently at 6.50%.
