Under this facility banks can borrow an amount up to 3 per cent of their loan book until the end of September. They are able to draw on additional amounts if they increase their lending to businesses, particularly small and medium-sized businesses.
The cost of funding available to the banking system under the TFF at 25 basis points is significantly lower than the cost of three-year funding in the market, which is currently around 75 basis points for the major banks, and even lower relative to the cost of funding in the market for the regional and smaller banks.