What is repo rate? How does it impact you? Definition, meaning, other important aspects that you must know
What is the repo rate? The repo rate, or the key interest rate at which the RBI lends money to commercial banks, plays a significant role in determining the cost of borrowing for individuals and businesses. When the repo rate decreases, banks are inclined to reduce their lending rates, making loans cheaper. On the flipside, when the repo rate increases, banks tend to pass on their higher borrowing costs to consumers. Here's a summary of this key interest rate which impacts you very much.
Borrowers are directly affected by changes in the repo rate as it influences the cost of borrowing and the affordability of loans. | Image: Pexels