Bank Rate A bank rate is the interest rate that a bank charges its customers on deposits. It is the cost of borrowing money for a bank to lend. The bank rat...
Bank Rate
A bank rate is the interest rate that a bank charges its customers on deposits. It is the cost of borrowing money for a bank to lend. The bank rate is also known as the discount rate.
Money Market Facility (MSF)
The Money Market Facility (MSF) is a market where banks can borrow and lend money to each other at the repo rate. The repo rate is the interest rate that the central bank pays to banks when it lends them money.
Loan Accommodation Facility (LAF)
The Loan Accommodation Facility (LAF) is a facility where banks can obtain short-term loans from the central bank at the repo rate. The central bank sets the loan accommodation facility rate, which is the interest rate that banks are required to pay for these loans.
Repo Rate
The repo rate is the interest rate that the central bank pays to banks when it buys or sells government securities. When the central bank buys a security, it sets the repo rate at the target repo rate. When the central bank sells a security, it sets the repo rate at the negative repo rate