Banking Awareness: You Must Know These RBI Rates & Definitions

RBI_Rates

Dear Reader, as far as banking awareness is concerned learning about RBI is vital. We say this because, as you know RBI is the central bank that regulates the banks in our country. You can expect frequent questions on and about RBI both in written exams as well as interviews. You would remember that a few days back we posted an article on facts about RBI. There was an excellent response to that article.  As a result, we will be adding more help articles on similar topics to help you improve your banking awareness.

Coming to this topic, you will be learning about the rates of RBI. You can expect one or two questions from this topic. For answering those, you must be aware of the rates like bank rate, CRR, SLR, MSF, RRR, etc.

Below you will find updated information on the current rates as well as their definitions.  These rates are those that exist as of today (25 July 2016). There will be changes in future. Hence you should always update yourself with the latest information before your exams.

Below table gives you short definition and its currents rates on RBI:

Rates Definition & its Current Rate
Bank Rate / Discount Rate It refers to the rate of interest which a central bank charges on loans and advances to a commercial bank.
Current Bank Rate : 7.00%
Cash Reserve Ratio (CRR) CRR is the amount of funds that the banks have to keep with RBI.
Current CRR : 4.00%
Repo Rate (RR) It refers to the rate at which the RBI lends money to commercial banks.
Repo Rate : 6.50%
Reverse Repo Rate (RRR) RBI borrows money from commercial banks is referred to RRR.
Current RRR : 6.00%
Marginal Standing Facility (MSF) The rate at which commercial banks could borrow funds overnight from RBI against Government securities during emergency period is called MSF.
Current MSF : 7.00%
Statutory Liquidity Ratio (SLR) It refers to the net amount which commercial banks have to maintain in the form of cash, gold or government securities before providing credit to their customers.
Current SLR : 21.00%

All the Best for your exam!!!

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