The central bank is mopping up the liquidity through issuing deposit collection tool.
NRB is finding difficulty to maintain interest rate corridor due to piled up liquidity in the banks. The interest rate corridor has fallen below the lower limit. The corridor is below 3 percent in current days.
Despite availing permanent liquidity facility to banks, NRB could not keep the interbank interest rate within the cap, thus, it is issuing deposit collection tool to mop up excess liquidity. In recent days, NRB is continuously mopping up excess liquidity.
The interested banks can submit application for the tool by July 31 at 3 pm. The banks are required to keep deposits of minimum Rs 100 million with NRB.
