liquidity facilities

Liquidity facilities are financial arrangements where a lender provides short-term funding to a borrower to ensure they have enough cash to meet immediate obligations or operational needs. Think of it as a safety net that helps organizations or institutions manage short-term liquidity shortages, preventing cash flow issues from disrupting their activities. These facilities are often used by banks, companies, or governments to maintain stability and confidence, especially during times of financial stress or market volatility. They are typically secured or backed by assets or guarantees, ensuring the lender can recover their funds.