 |
| Indian Rupee Symbol |
Repo rate and reverse repo rate reduced according to the pandemic situation of the Covid 19 by the Reserve Bank of India again in 2020. This repo rate news affected the share market of India to a downward direction and the Sensex, Nifty closed in negative indicator.
And also the moratorium period which was already declared in the lockdown period is extended to 31st august, 2020. Reserve Bank Governor: Sakthi Kanth Das
RBI monetary: policy repo rate and reverse repo rate
Reserve Bank of India cuts the repo rate from 4.40 % to 4 %. The 0.5 % reduction in the repo rate shows the economic downward in the future. As a result of the reduction in the repo rate by RBI, the interest rate of bank loans will be reduced.The Reverse repo rate also reduced from 3.75 % to 3.35 %. This change tempts the bankers to lend money as loans than depositing in the RBI. It helps to increase the availability of money and economic equilibrium. Along with this, the deposit interest rates also get reduced.
Repo rate at present 2020: 4 %
Reverse repo rate at present 2020: 3.35 %
Repo rate and Reverse repo rate meaning
Repo rate: Reserve Bank of India lends loans to the commercial banks at some time when the commercial banks need funds. The banks need to pay the interest on this amount as per the rate fixed by the RBI. This interest rate is commonly known as Repo Rate.Current repo rate: 4 %
Reverse Repo rate: The commercial banks deposit their funds in the RBI as per the regulation. RBI will give the interest on the amount which commercial banks deposited. This interest rate is also fixed by the RBI. It is known as the Reverse Repo rate.
Current reverse repo rate: 3.35%
These are the monetary measures of the RBI to control the inflation and deflation. The availability of the money in the economy can be controlled using these measures.
Repo rate and interest rate (EMI)
Repo rates will reduce the number of emi or amount of emi. The interest rates of loan by banks also get reduced as a result of the reduction in repo rate. Repo linked loans will get the benefit within the period in 3 months and the others should wait for the date which bank reduce the loan’s interest rate.The new customers who are going to take the loan also get the benefits. They also get the benefit of Prime Minister’s Awas Yojana interest subsidy if their annual income is between 6 lakhs and 18 lakhs. This benefit is limited for the loans upto 31st March, 2021.
Depositors affected?
Those who depend on the Fixed Deposit interest in their life for the expenses will be affected badly. The interest on Fixed Deposit will be reduced following the changes in repo and reverse repo. The banks already started to reduce the deposit interest rate.Interest liability on loans? – Bank Moratorium Period
Ofcourse, there will be interest liability on your loan according to your outstanding balance and the interest rate of loan. Don’t misunderstand that there will not be interest in the moratorium period. Moratorium is just a relaxation in the monthly repayment of loans for a certain period of time.Moratorium period in India is from 01 March, 2020 to 31st August, 2020. The moratorium is also applicable for the agricultural loans and the gold loans also.
Repo rate and reverse repo rate reduced according to the pandemic situation of the Covid 19 by the Reserve Bank of India again in 2020. This repo rate news affected the share market of India to a downward direction and the Sensex, Nifty closed in negative indicator.
And also the moratorium period which was already declared in the lockdown period is extended to 31st august, 2020. Reserve Bank Governor: Sakthi Kanth Das
RBI monetary: policy repo rate and reverse repo rate
Reserve Bank of India cuts the repo rate from 4.40 % to 4 %. The 0.5 % reduction in the repo rate shows the economic downward in the future. As a result of the reduction in the repo rate by RBI, the interest rate of bank loans will be reduced.
The Reverse repo rate also reduced from 3.75 % to 3.35 %. This change tempts the bankers to lend money as loans than depositing in the RBI. It helps to increase the availability of money and economic equilibrium. Along with this, the deposit interest rates also get reduced.
Repo rate at present 2020: 4 %
Reverse repo rate at present 2020: 3.35 %
Repo rate and Reverse repo rate meaning
Repo rate: Reserve Bank of India lends loans to the commercial banks at some time when the commercial banks need funds. The banks need to pay the interest on this amount as per the rate fixed by the RBI. This interest rate is commonly known as Repo Rate.
Current repo rate: 4 %
Reverse Repo rate: The commercial banks deposit their funds in the RBI as per the regulation. RBI will give the interest on the amount which commercial banks deposited. This interest rate is also fixed by the RBI. It is known as the Reverse Repo rate.
Current reverse repo rate: 3.35%
These are the monetary measures of the RBI to control the inflation and deflation. The availability of the money in the economy can be controlled using these measures.
Repo rate and interest rate (EMI)
Repo rates will reduce the number of emi or amount of emi. The interest rates of loan by banks also get reduced as a result of the reduction in repo rate. Repo linked loans will get the benefit within the period in 3 months and the others should wait for the date which bank reduce the loan’s interest rate.
The new customers who are going to take the loan also get the benefits. They also get the benefit of Prime Minister’s Awas Yojana interest subsidy if their annual income is between 6 lakhs and 18 lakhs. This benefit is limited for the loans upto 31st March, 2021.
Depositors affected?
Those who depend on the Fixed Deposit interest in their life for the expenses will be affected badly. The interest on Fixed Deposit will be reduced following the changes in repo and reverse repo. The banks already started to reduce the deposit interest rate.
Ofcourse, there will be interest liability on your loan according to your outstanding balance and the interest rate of loan. Don’t misunderstand that there will not be interest in the moratorium period. Moratorium is just a relaxation in the monthly repayment of loans for a certain period of time.
Moratorium period in India is from 01 March, 2020 to 31st August, 2020. The moratorium is also applicable for the agricultural loans and the gold loans also.
Post a Comment
Thank You