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Home > Markets and Payments > Asset Purchase Facility - Term Funding Scheme

Asset Purchase Facility - Term Funding Scheme

The Term Funding Scheme (TFS) is designed to reinforce the transmission of Bank Rate cuts to those interest rates actually faced by households and businesses by providing term funding to banks at rates close to Bank Rate. It is a monetary policy tool of the Monetary Policy Committee and will be operated as part of the Asset Purchase Facility. In addition to its primary monetary policy objective, the TFS will provide participants with a cost effective source of funding in the form of central bank reserves to support additional lending to the real economy.
The TFS will allow participants to borrow central bank reserves in exchange for eligible collateral. Institutions which are eligible to apply are banks and building societies that are participants in the Bank of England’s Sterling Monetary Framework and signed up to the Discount Window Facility.
The Monetary Policy Summary of the August 2016 Inflation Report contains a box which gives further information on the monetary policy package, announced on 4 August 2016, to support the UK economy. The TFS forms part of that package, and the drawdown window will run from 19 September 2016 to 28 February 2018.


Latest Information

Term Funding Scheme - Usage and lending data
7 September 2017

Market Notice: Asset Purchase Facility: Term Funding Scheme
4 August 2016