difference between repo rate and bank rate
Answers
Simply put, repo rate is the rate at which the RBI lends to commercial banks by purchasing securities while bank rate is the lending rate at which commercial banks can borrow from the RBI without providing any security.
Bank Rate and REPO rate are almost similar in nature. The central bank(RBI for India) lends money to a private bank for which the private bank needs to pay the interest rate. The only difference is that the REPO rate is used to lend money for the short term while the bank rate for the long term.
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repo rate is concerned with short term lending by Central Bank to commercial bank and it is governed by the short-term interest ratewall paint rate is applicable to long term lending by the central bank and commercial bank and it is governed by long-term interest rate