An instrument of monetary policy where banks can borrow money directly from the central bank. These are usually on a short-term basis to compensate for liquidity caused by disruptions.
This interest rate is different from the prime rate and the Fed Funds Rate which is the rate banks charge either other on interbank lending.
The Discount Window often used to denote in particular the lending programs under which credit may be provided to eligible depository institutions. Regular lending programs include the primary, secondary, and seasonal lending programs. During the great financial crisis, discount window credit was also extended to depository institutions under the Term Auction Facility (TAF). All discount window borrowing is fully secured by collateral.
