RBI to borrow up to ₹2 lakh crore overnight on 29 Sep
RBI will run a one-day VRRR auction on 29 September to take up to ₹2,00,000 crore of spare cash from banks, returned on 30 September.
Official title: RBI to conduct Overnight Variable Rate Reverse Repo (VRRR) auction under LAF on September 29, 2026 · Press Release 2026-2027/1204
What happened
RBI will hold a overnight Variable Rate Reverse Repo (VRRR) auction on Tuesday, 29 September 2026. It wants to borrow up to ₹2,00,000 crore from banks. Bids can be placed between 9:30 AM and 10:00 AM, and the money goes back to the banks on Wednesday, 30 September. The release says only that this follows a review of current and evolving liquidity conditions.
A reverse repo auction means RBI is the borrower and banks are the lenders. Such auctions are held when banks have more cash than they need, and they pull that extra money out of the system for a day. ₹2,00,000 crore is ₹2 lakh crore.
What it means for you
No direct effect on your deposits, loans or EMIs. This is an operation between RBI and banks.
What it means for businesses
Banks and other eligible bidders decide whether to lend their spare cash to RBI at the auction rate. For businesses and borrowers there is no direct change.
Links in this release, explained
- RBI press release of 13 February 2020 on VRRR operating rules
The February 2020 RBI release that set out the standard rules for variable rate auctions: who can bid, how bids are ranked and how the cut-off rate is set. Open it only if you want the mechanics; this auction follows it.
www.rbi.org.in/Scripts/BS_PressReleaseDisplay.aspx?prid=49399
Read the original
Press release on rbi.org.in ↗ Official PDF ↗
This explainer simplifies the official text. If anything here differs from the RBI's release, the release is right.