Explanation:

In the wake of demonetization, the government has increased the amount of MSBs to be issued to Rs 6 lakh crores from just 0.3 lakh crores. After demonetization, huge deposits were put into the banking system. At the same time, banks can’t lend it to customers as it is just temporary money. The RBI has instructed banks to keep all the additional deposits as CRR. But here, the banks will suffer losses as they have to pay interest to the depositors. To compensate banks, the MSS policy is revived. Here, banks can put the excess money obtained from deposits in MSBs. They can get an interest payment as well.