With effect from August 6, 2005, non-bank participants have been completely phased out of the call money market. •  Several new financial instruments have been introduced. The traditional refinance support on fixed terms has been replaced by a full-fledged Liquidity Adjustment Facility (LAF) was introduced on June 5, 2000 with a view to modulating short-term liquidity under diverse market conditions.
Another challenge is the re-emergence of monetary policy divergence. In particular, the US Fed is signaling a continuation of its normalization path through policy rate increases while other central banks in major economies remain accommodative by keeping a lid on interest rates. This divergence can result in volatility in financial markets and possibly dampen credit activities in the near-term and growth in the longer-term.