What is Repo Rate and Reverse Ripo rates - Know all about RIPO Rate of Reserve Bank Of India and Reverse Ripo rate of Reserve Bank of India.

What is Repo  Rate and Reverse Ripo rates - Know all about RIPO Rate of Reserve Bank Of India and Reverse Ripo rate of Reserve Bank of India. 

 When banks have any shortage of funds, they can borrow it from Reserve Bank of India or from other banks. The rate at which the RBI lends money to commercial banks is called repo rate, a short term for repurchase agreement. A reduction in the repo rate will help banks to get money at a cheaper rate. When the repo rate increases borrowing from RBI becomes more expensive.[1]. the repo rate in India is currently 8.5 % as of October 25,2011

Increase of Reserve bank Rate of Ripo

RIPO	percentage
october 25 2011	8.500 %
september 16 2011	8.250 %
july 26 2011	8.000 %
june 16 2011	7.500 %
may 03 2011	7.250 %
march 17 2011	6.750 %
january 25 2011	6.500 %
november 02 2010	6.250 %
september 16 2010	6.000 %
August  27  2010	5.750 %
August 2    2010	5.500%
April 20 2010	5.250%
Mach 19  2010	5.00%

What is Reverse RIPO Rate ?.  Know all about Reverse Ripo rate of Reserve Bank of India. 

Reverse Repo rate is the rate at which Reserve Bank of India (RBI) borrows money from banks. Banks are always happy to lend money to RBI since their money are in safe hands with a good interest. An increase in Reverse repo rate can cause the banks to transfer more funds to RBI due to this attractive interest rates. It can cause the money to be drawn out of the banking system.

Due to this fine tuning of RBI using its tools of CRR, Bank Rate, Repo Rate and Reverse Repo rate our banks adjust their lending or investment rates for common man.

Increase in  Reverse Ripo rate of Reserve Bank of India.

Reverse Ripo	percentage
October 25 2011	7.500 %
September 16 2011	7.250 %
July 26 2011	7.000 %
June 16 2011	6.500 %
may 03 2011	6.250 %
march 17 2011	5.750 %
January 25 2011	5..500 %
November 02 2010	5..250 %
September 16 2010	4.750 %
August  27  2010	4.250 %
August 2    2010	4.000%
April 20 2010	3.750%
Mach 19  2010	3.500%

 What is CRR in India . CRR Rate in India

Cash reserve Ratio (CRR) is the amount of funds that the banks have to keep with RBI. If RBI decides to increase the percent of this, the available amount with the banks comes down. RBI is using this method (increase of CRR rate), to drain out the excessive money from the banks.