It may be appropriate to note that in most of the developed financial markets, the standing facilities operate at the margin. At present RBI provides standing facilities comprising the support available to banks under Collateralized Lending Facility (CLF) and export credit facility to banks, and liquidity support to PDs.
One way of reducing the standing facility will be to eliminate CLF from the standing facilities and reducing the present ratio of normal and back-stop facilities. The existing methodology of calculating eligible export credit refinance continues till March 2002 and RBI has expressed its intention of moving away from sector specific refinance.