Question

What is the interest rate charged by the RBI on loans to commercial banks called?

• A. Reverse Repo Rate
• B. Repo Rate
• C. Bank Rate
• D. Base Rate

Answer 1

Answer:

B. Repo Rate

• Interest rate charged by the RBI on loans to commercial banks is called the Repo Rate.

• This is one of the key monetary policy tools used by the RBI (Reserve Bank of India) to control money supply and credit in the economy.

• When commercial banks need to borrow money from the RBI, they need to pay interest at this repo rate.