top button
Flag Notify
    Connect to us
      Facebook Login
      Site Registration Why to Join

Facebook Login
Site Registration

What is Term Repo? What is its role in RBI’s monetary policy?

+1 vote
9 views
What is Term Repo? What is its role in RBI’s monetary policy?
posted Sep 1, 2017 by Swati Tyagi

Share this question
Facebook Share Button Twitter Share Button Google+ Share Button LinkedIn Share Button Multiple Social Share Button

1 Answer

0 votes

A term repo is a repo of more than one-day duration. The word term denotes longer period. Hence it is a way for banks to avail money from the RBI for more than one-day duration. As in the case of repo, the loan seeking bank should submit securities to the RBI. Since the loan is for more duration, the bank should give higher interest than the repo rate.

Whenever the RBI assess that there is the need for funds for three to 28 days for the banking system, it notifies the term repo auction. Similarly, the central bank also announces the amount it would like to provide to the banks in total. The auction amount will be within 0.75 %of the total deposit in the banking system.

answer Sep 5, 2017 by Shantanu Arora
Contact Us
+91 9880187415
sales@queryhome.net
support@queryhome.net
#280, 3rd floor, 5th Main
6th Sector, HSR Layout
Bangalore-560102
Karnataka INDIA.
QUERY HOME
...