---
title: "Marginal Standing Facility (MSF): RBI Window Explained"
description: "The Marginal Standing Facility (MSF) is the RBI's overnight emergency lending window, priced above the repo rate and forming the LAF corridor's upper bound."
url: "https://modeldiplomat.com/learn/glossary/marginal-standing-facility"
---

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Model Diplomat Research Team · Last reviewed June 22, 2026

TL;DR

- The Marginal Standing Facility is an overnight Reserve Bank of India window that lets scheduled commercial banks borrow against statutory liquidity reserves at a penal rate above the repo rate.
- How does the MSF rate relate to the repo rate?
- What makes the MSF different from ordinary LAF repo borrowing?
- How much can a bank borrow under the MSF?
- Why was the MSF introduced in 2011?

[Civil Service & Diplomatic Exams](https://modeldiplomat.com/learn/civil-services/glossary)Updated June 22, 2026

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In September 2013, RBI Governor D. Subbarao raised the Marginal Standing Facility rate to 10.25 percent—300 basis points above the repo rate—to defend a sliding rupee, making the MSF the effective policy rate until the measure was reversed weeks later.

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