What is Reverse Repo Rate? — Meaning, Definition & Example
Definition
Reverse repo rate is the interest rate at which RBI borrows money from commercial banks. It is a tool to absorb excess liquidity from the banking system. When reverse repo rate increases, banks prefer to park money with RBI rather than lending, reducing money supply.
When RBI raises reverse repo rate from 3.35% to 3.5%, banks earn more by depositing surplus funds with RBI, reducing their lending to businesses and individuals.
🇮🇳 Reverse Repo Rate in Hindi / हिंदी में
रिवर्स रेपो रेट — रिवर्स रेपो रेट वह ब्याज दर है जिस पर RBI वाणिज्यिक बैंकों से पैसा उधार लेता है। यह बैंकिंग प्रणाली से अतिरिक्त तरलता को अवशोषित करने का उपकरण है।
Reverse Repo Rate (Hinglish) — Reverse repo rate wo interest rate hai jis pe RBI commercial banks se paisa udhaar leta hai. Excess liquidity absorb karne ka tool hai.