Repo Rate: A
Repo rate is the rate at which banks borrow rupees for short term from RBI against securities.
Whenever the banks have any shortage of funds they can borrow it from
RBI. A reduction in the repo rate will help banks to get money at a
cheaper rate. When the repo rate increases, borrowing from RBI becomes
more expensive. Currently, Repo Rate is 8.5%
Bank job is a ray of hope among unemployed qualified youths and attracts lot of competition. It is difficult to crack unless fully prepared. This blog shall endeavor to help the youths to find a job n the bank.
Reverse Repo Rate: This is exact opposite of Repo rate. Reverse Repo rate is the rate at which Reserve Bank of India (RBI) borrows money from banks. Currently, reverse repo rate is 7.5%
ReplyDeleteCRR Rate: CRR is the percentage of bank deposit that banks have to keep with the RBI.If RBI decides to increase the percent of this, the available amount with the banks comes down.This is done by RBI to drain out the excessive money from the banks. If RBI decreases CRR rate then the available amount with banks increase. Today RBI have cut CRR rate to 5.5 per cent from 6 per cent w.e.f 28.1.2012.
ReplyDeleteBank Rate - This is the rate at which central bank (RBI) lends money to other banks or financial institutions. If the bank rate goes up, long-term interest rates also tend to move up, and vice-versa.Currently bank rate is 6%.
ReplyDeleteBank: Bank primarily collects deposits from the customers and channelizes such deposits into loan and advances to the borrowers. The difference between interest paid on deposits and interest received on the loans become net interest income which is the main source of bank income. More net interest margin means more income to bank and vice versa. A good banker will always have an eye to improve its net interest income.
ReplyDeleteSLR (Statutory Liquidity Ratio): Apart from keeping a portion of deposits with the RBI as cash, banks are also required to maintain a minimum percentage of deposits with them at the end of every business day, in the form of gold, cash, government bonds or other approved securities. This minimum percentage is called Statutory Liquidity Ratio. Currently rate of SLR is 24%.
ReplyDeleteReal time gross settlement: It’s a fund transfer mechanism that enables money to move from one bank to another on a real time and gross basis. Simply put, real time means the transaction is settled instantly without any waiting period and gross means that it is not bunched with any other transaction.
ReplyDeleteNational electronic funds transfer:NEFT enables funds transfer from one bank to another but works a bit differently than RTGS since the settlement takes place in batches rather than individually, making NEFT slower than RTGS.
ReplyDeleteThe transfer is not direct and RBI acts as the service provider to transfer the money from one account to another. You can transfer any amount through NEFT, even a rupee.
itz nice .
ReplyDeleteas i learnt some thing more.
thanks.........
urz .khalid