The use of a new tool by the Federal Reserve called the overnight reverse repo facility affects the repo market. When money fund lenders invest in this facility, it reduces private repo activity. The presence of the Fed as a borrower in the repo market increases funding costs for borrowers. Despite this, borrowers do not decrease their total borrowing but instead turn to riskier collateral types and non-money fund lenders. This behavior could lead to increased financial instability in the private repo funding market.