discuss bank rate policy in details
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Bank rate, also known as discount rate in American English, is the rate of interest which a central bank charges on its loans and advances to a commercial bank. ... Whenever a bank has a shortage of funds, they can typically borrow from the central bank based on the monetary policy of the country.
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The bank rate is a traditional weapon of credit control used by a central bank. In order to perform its function as lender of last resort to commercial banks, it will discount first-class bills or advance loans against approved securities.
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