Michelle A. Clark examines the rationale for and use of this Federal Reserve program. She concludes with some observations on its role in light of recent financial innovations. The author first outlines the purpose of the Seasonal Borrowing Privilege (SBP), then describes its administration and the pattern of borrowing since its inception. She then looks in closer detail at the pattern of program usage in the Eighth Federal Reserve District over the period 1984 through 1990. She finds that the usage of the SBP increased substantially over the period as the number of eligible institutions and awareness of the program increased. An analysis of loan and liquidity ratios for a group of banks prior to and during use of the SBP indicates that the program is achieving its desired objectives. Nonetheless, documented changes in the structure, branching status and location of program users in recent years suggest that borrowing banks may have alternative sources of credit beyond the SBP.