What is a repo rate? The Repo rate, also called Repo rate, is the interest rate on which the Reserve Bank of India (RBI) lends money to all banks in India. If banks do not have money to their customers, such as home loans, car loans or for everyday tasks. Banks go to the Reserve Bank of India, that is, RBI to meet this deficit. As the repo rate increases, loans become expensive, people spend less, reducing market flow in the market and inflation is under control. If the economy is slow, the RBI reduces the repo rate. It makes loans cheap, people spend more and investing, which offends economic growth. If banks do not have money, they can immediately take money from RBI using the repo rate. It does not cause any hindrance in the operation of the bank. If you have made a loan at a floating rate, your EMI can be lowered if the repo rate decreases, giving you relief. If the repo rate is low, people and businesses start taking new projects by loans at low interest, increasing jobs. The RBI maintains the balance of money in the economy using the repo rate. This does not allow a lot of money to get into the market or very little, which holds market stability. Click here Life & Style Click for more stories Click here
-
-
-
-
