RBI absorbs ₹3.93 lakh cr from banking system via VRRR auction
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In addition to the VRRR auctions, the central bank unveiled plans last week to sell government securities through Open Market Operations (OMO) totalling ₹1 lakh crore, spread across three installments, with the inaugural auction scheduled for September 17.
On Tuesday, the Reserve Bank of India (RBI) mopped up ₹3,93,352 crore via a variable rate reverse repo (VRRR) auction, responding to a significant surplus of liquidity within the banking sector.
The RBI received bids totalling ₹3,93,352 crore against a notified amount of ₹5 lakh crore and accepted every bid at a cut‑off and weighted average rate of 5.24%.
During the past month, the RBI has been running VRRR auctions to siphon out excess liquidity from banks and bring overnight money‑market rates in line with the repo rate.
The banking system’s liquidity surplus was pegged at roughly ₹10.73 lakh crore as of September 11.
Beyond VRRR auctions, the central bank announced last week a series of Open Market Operation (OMO) sales of government securities worth ₹1 lakh crore, split into three tranches, with the first tranche auction slated for September 17.
The RBI said the first tranche of ₹50,000 crore would be auctioned on September 17, followed by two subsequent tranches of ₹25,000 crore each on September 21 and September 28.
Banks were awash with liquidity after heavy mobilisation of FCNR (B) deposits, which pumped foreign currency into the system; subsequent swaps with the RBI then supplied rupee liquidity to the lenders.
In addition to FCNR (B) inflows, month‑end government spending on salaries, pensions and other obligations further bolstered liquidity in the banking system.
Published on September 15, 2026
