Date : Mar 30, 2017
It has been decided, in consultation with the Government of India, that the limit for Ways and Means Advances (WMA) for the first half of the financial year 2017-18 (April 2017 – September 2017) will be at ₹ 60,000 crore.
The Reserve Bank may trigger fresh floatation of market loans when the Government of India utilises 75 per cent of the WMA limit.
The Reserve Bank retains the flexibility to revise the limit at any time, in consultation with the Government of India, taking into consideration the prevailing circumstances.
The interest rate on WMA/overdraft will be:
- WMA: Repo Rate
- Overdraft: Two percent above the Repo Rate
The minimum balance required to be maintained by the Government of India with the Reserve Bank of India will not be less than ₹ 100 crore on Fridays, on the date of closure of Government of India’s financial year and on June 30, i.e., closure of the annual accounts of the Reserve Bank of India and not less than ₹ 10 crore on other days.
As per the provisions of the agreement dated March 26, 1997 between the Government of India and the Reserve Bank of India, overdrafts beyond ten consecutive working days will not be allowed.
The WMA limit for the second half of the financial year 2017-18 will be fixed in September 2017.
Ajit Prasad
Assistant Adviser
Press Release : 2016-2017/2623