Term Funding Facility to Support Lending to Australian Businesses

The Reserve Bank has established a Term Funding Facility (TFF) to offer three-year funding to authorised deposit-taking institutions (ADIs). The facility has two objectives:

  • to reinforce the benefits to the economy of a lower cash rate, by reducing the funding costs of ADIs and in turn helping to reduce interest rates for borrowers. It complements the reduction in funding costs from the Reserve Bank's target for three-year Australian Government bond yields
  • to encourage ADIs to support businesses during a difficult period, ADIs have access to additional low-cost funding if they expand their lending to businesses. The scheme encourages lending to all businesses, although the incentives are stronger for small and medium-sized enterprises (SMEs).

ADIs are encouraged to consider taking advantage of this scheme to support their customers and help the economy through a difficult period.

The TFF was announced on 19 March 2020, and has subsequently been amended to provide further support in response to economic developments. An increase and extension of the TFF was announced on 1 September 2020. A reduction to the TFF pricing rate was announced on 3 November 2020. The Market Announcement published on 3 November 2020, covers the main features of the TFF

Information for ADIs intending to take part in the TFF

The Terms and Conditions for TFF Repos are outlined in the RBA Information and Transfer System (RITS) Regulations, in particular, Annexure F which covers Additional Terms Applicable to TFF Repos.

The TFF Operational Notes provide details about how the scheme will work in practice, including eligibility criteria, more detailed information on the calculation of the Funding Allowances and the process for conducting a TFF repo to obtain funding. The Operational Notes are intended to assist ADIs to better understand how the TFF will operate. They are only legally binding to the extent that they are specifically referred to in the RITS Regulations.

The TFF Worked Examples provide additional detail on how Funding Allowances are calculated and illustrate the quantity of borrowing available in various scenarios.

Please note that the terms of the TFF can be revised by the Reserve Bank at any time. Usage of the TFF will be at the sole discretion of the Reserve Bank.

Forms

Published information

The Reserve Bank publishes in Statistical Table A3 weekly data on total TFF drawings and monthly data on the total TFF Funding Allowance and Additional Allowance accruing from lending to small and medium-sized enterprises and large businesses.

Key dates

Key dates of the Term Funding Facility
Date Event
19 March 2020 TFF Market Announcement
31 March 2020 ADIs notified of Funding Allowances and instructions for submitting TFF Repo Requests
1 April 2020 (midday) First date for submission of TFF Repo Requests
6 April 2020 First settlement date for TFF repos
1 September 2020 TFF Market Announcement
25 September 2020 Deadline for submission of TFF Repo Requests for Initial Allowance
28 September 2020 First date for submission of TFF Repo Requests for Supplementary Allowance
30 September 2020 Last date for drawdowns of Initial Allowance
1 October 2020 First date for drawdowns against Supplementary Allowance
3 November 2020 TFF Market Announcement
25 June 2021 Deadline for submission of TFF Repo Requests for Additional and Supplementary Allowance
30 June 2021 Last date for drawdowns of Additional and Supplementary Allowance
Recurring dates
Fridays Publication of statistics on usage of the Term Funding Facility (see release schedule of Table A3)
15th business day of the month Deadline for ADIs making new reports to the Reserve Bank
  • Thursday 23 April
  • Thursday 21 May
  • Monday 22 June
  • Tuesday 21 July
  • Monday 24 August
  • Monday 21 September
  • Thursday 22 October
  • Monday 23 November
  • Monday 21 December
  • Friday 22 January 2021
  • Friday 19 February 2021
  • Monday 22 March 2021
  • Friday 23 April 2021
  • Friday 21 May 2021
1st business day of the month Reserve Bank notifies ADIs of the new value of their Additional Allowance
  • Friday 1 May
  • Monday 1 June
  • Wednesday 1 July
  • Tuesday 4 August (Monday 3rd is Bank Holiday)
  • Tuesday 1 September
  • Thursday 1 October
  • Monday 2 November
  • Tuesday 1 December
  • Monday 4 January 2021 (Friday 1st is New Year's Day)
  • Monday 1 February 2021
  • Monday 1 March 2021
  • Thursday 1 April 2021
  • Monday 3 May 2021
  • Tuesday 1 June 2021

Contact details

Contacts
You want to … Your contact
Make a media or public enquiry RBAInfo@rba.gov.au
Enquire about the TFF RBATFF@rba.gov.au
Submit a TFF Repo Request Form TFFNotifications@rba.gov.au
Submit a Reporting Template for ADIs Making New Reports TFFNotifications@rba.gov.au
Substitute collateral on a TFF Repo Domestic Markets Operations
Terminate a TFF Repo Domestic Markets Operations
Provide Notice regarding a TFF Repo TFFNotifications@rba.gov.au
Enquire about Eligible Securities Eligible_Securities@rba.gov.au