Current Repo Rate

On March 20, 2013, RBI has lowered Repo Rate by 25 basis points from 7.75% to 7.50%. The objective is ease pressure on the reviving economy.


Repo Rate, or repurchase rate, is the rate at which RBI lends to banks for short periods. This is done by RBI buying government bonds from banks with an agreement to sell them back at a fixed rate. If the RBI wants to make it more expensive for banks to borrow money, it increases the repo rate. Similarly, if it wants to make it cheaper for banks to borrow money, it reduces the repo rate.
Please note that Bank Rate and Repo Rate seem to be similar terms because in both of them RBI lends to the banks. However, Repo Rate is a short-term measure and it refers to short-term loans and used for controlling the amount of money in the market, Bank Rate is a long-term measure and is governed by the long-term monetary policies of the RBI. In broader term, bank rate is the rate of interest which a central bank charges on the loans and advances that it extends to commercial banks and other financial intermediaries. RBI uses this tool to control the money supply.
How Repo Rate Works?
When RBI reduces the Repo Rate, the banks can borrow more at a lower cost. This contributes to lowering of the rates. The effects can be seen on the markets in short term.

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Comments

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  • neha
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    yeah... i always had a doubt of bank and repo rate.. bt now it is cleared!

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    Reply

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    Reply

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    Reply

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  • syedrafi
    Reply

    repo rate 8.25
    reverse repo rate 7.25

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    Reply

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  • preksha
    Reply

    thnx for sharing such useful info but can u tell me under bank rate and repo rate duration of loan provided by RBI to banks
    bank rate: greater than one year or 90 days.
    repo rate:1 to 14 days or till 90 days
    .

  • preksha
    Reply

    do reply as soon as possible,anyone know the answer

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    Reply

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  • rajendra vibhande
    Reply

    good information

  • shweta singh
    Reply

    plz send me table of current ratas.like repo rate etc.

  • khemraj
    Reply

    Thanks a lot! It is very helpful to me.

  • v p singh
    Reply

    now i can differenciate between repo and bate rate .. after a very long time..

  • shadab
    Reply

    now i don't have any confusion related to this topic......thanks a lot

  • Ajeet uikey
    Reply

    Very good information

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    Reply

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    Reply

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  • vikash ojha
    Reply

    really very relevant information on repo, bank and revres repo rates....very nice information and to the point...good job.

  • Pintu nayak
    Reply

    Thanxxxxxx,,,,n,,,grt infrmation,,,,,

  • srinivas
    Reply

    nice information thanku so much

  • vishal srivastava
    Reply

    No Doubt the definition of Repo Rate has been crystally cleared.
    Thanks

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    Reply

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  • Chandan Singh
    Reply

    Thanks for such a valuable article i wish it would better if there would example to explain bank rate and repo rate......

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    Reply

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    Reply

    clearly explained.

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    Reply

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    Reply

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    Reply

    nice data collecttion site all student easier to search all types usefull data

  • dinesh paliwal
    Reply

    now the repo rate is :-7.75
    rev.repo:-6.75
    crr :-4
    bank rate:-8.75
    msf :-8.75
    slr :-23

  • sandeep
    Reply

    thank to providing these important information

  • Sonika parihar
    Reply

    Nce information

  • yashi
    Reply

    thanks for such a nice explanation,really very usefull to us

  • sharad pansare
    Reply

    gr8,tnx 4 that...

  • shubham
    Reply

    what is the minimum and maximum time duration of repo rate....

  • Raghavendra
    Reply

    Ossamm...................

  • Sameer
    Reply

    please upgrade this information

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    Reply

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    Reply

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  • smart1
    Reply

    The Reserve Bank of India (RBI) kept interest rates unchanged on Monday after cutting them in each of its previous three policy reviews, warning of upward risks to inflation posed by a falling rupee and increases in food prices.

    The RBI also called for vigilance over global economic uncertainty, citing the risks of a reversal of capital flows from emerging markets. Such outflows would exacerbate the country's high current account deficit.
    Following are highlights from the monetary policy statement:

    Policy Measures
    Keeps repo rate unchanged at 7.25 percent.
    Reverse repo rate stays at 6.25 percent.
    Cash reserve ratio unchanged at 4.00 percent.
    Marginal Standing Facility rate stays at 8.25 percent.
    Bank rate stays at 8.25 percent.

  • Bhuvana
    Reply

    whether repo rate is at the rate it repurchase the gvt bonds or the rate at which bank has to pay interest to the RBI