The banks perform lending activities among them at rate ehich popularly known as rates called as
Answers
The rate of interest on bank-to-bank lending is known as Interbank Lending Rate or Interbank Rate. If the loan is for a period of a single night, the interest rate is also called an Overnight Rate.
Interbank lending is common between banks. Loans are given for specified periods, ranging from a single night to one week or less. Such lending and borrowing are carried out, to maintain a bank’s liquid assets, according to specifications of the Reserve Bank of India.
The answer is the bank rate.
In this, the central bank will give or lend out an amount to the domestic banks on the short-term loan basis.
The bank rate is taken up as an interest in which the amount is lent.
Apart from this, one has to keep a proper track on the bank rate to ensure that the economic activities are much affected by the central banks.