Liquidity Support: RBI Pumps ₹79,256 Crore Through Overnight VRR Amid Liquidity Deficit

The Reserve Bank of India (RBI) has infused ₹79,256 crore into the banking system through an overnight variable rate repo (VRR) auction.  

This move comes amidst a liquidity deficit in the banking system, exacerbated by recent advance tax payments. 

Details of the VRR Auction 

On March 23, 2026, the RBI conducted an overnight VRR auction, injecting ₹79,256 crore into the banking system. The funds were infused at cut-off and weighted average rates of 5.26%. 

Despite the RBI's notification of ₹1 trillion for the auction, the actual liquidity injected was significantly lower, reflecting the current liquidity conditions. 

As per PTI report, the banking system is currently experiencing a liquidity deficit of approximately ₹65,395.64 crore as of March 23, 2026. This deficit is largely attributed to the outflow of funds due to advance tax payments. 

Recent Liquidity Measures by RBI 

Prior to this, on March 17, 2026, the RBI injected ₹48,014 crore into the banking system via a seven-day VRR auction.  

Additionally, on March 20, 2026, the central bank infused ₹25,101 crore through a three-day VRR auction.  

These measures are part of the RBI's ongoing efforts to manage liquidity in the banking sector. 

Read More: RBI Approves Budget for Accounting Year 2026-27 at 622nd Board Meeting! 

Durable Liquidity Infusion 

In addition to transient liquidity measures, the RBI has infused ₹3.50 trillion of durable liquidity into the banking system through open market operations (OMO) since January 2026.  

These operations involve the purchase of government securities, aimed at ensuring adequate liquidity in the financial system. 

Conclusion 

The RBI's recent infusion of ₹79,256 crore through an overnight VRR auction highlights its ongoing efforts to manage liquidity in the banking system. Despite a significant liquidity deficit due to advance tax payments, the central bank continues to employ various measures to ensure stability in the financial sector. 

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