What Is MSS Full Form in Banking:

MSS in banking means “Monetary Stabilization Scheme.” It’s like a tool used by the central bank to handle too much money in the economy. When there’s too many funds floating around, the central bank issues special bonds called MSS bonds. People and banks buy these bonds, helping to reduce the extra money.

These MSS bonds have a short-term duration and earn some interest. This interest is like a fee for holding extra cash. It encourages people and banks to invest in these bonds instead of keeping too much money idle. This process helps the central bank control inflation and keep the economy stable.

More Details About The MSS:

The Monetary Stabilization Scheme is a temporary fix. Once the central bank thinks the money situation is better, it can sell these MSS bonds or let them finish their term. This releases the absorbed money back into the market.

MSS in banking is a tool, the Monetary Stabilization Scheme, used by the central bank to manage too much money in the economy. It involves using special bonds to absorb extra funds and control inflation. It’s a short-term solution, and when things improve, the absorbed money goes back into the market.