Which rate refers to the interest rate charged by the central bank on overnight loans to commercial banks against government securities without requiring collateral?

💡 Solution & Explanation

The Marginal Standing Facility allows scheduled commercial banks to borrow overnight funds from the Reserve Bank of India up to a specified limit against government securities at a rate higher than the repo rate without collateral encumbrance of statutory liquidity ratios beyond limits. Repo rates involve collateralized lending for varying repo terms. Bank rates apply to rediscounting bills of exchange.