Repo Rate, Reserve Repo, Margin. Normal percentage on Loan

As of December 6, 2024, the Reserve Bank of India (RBI) has set the following key rates and ratios:

Repo Rate: 6.50%

Reverse Repo Rate: 3.35%

Bank Rate: 6.75%

Standing Deposit Facility (SDF) Rate: 6.25%

Marginal Standing Facility (MSF) Rate: 6.75%

Cash Reserve Ratio (CRR): Reduced by 50 basis points to 4.0%, implemented in two tranches on December 14 and December 28, 2024. 

Statutory Liquidity Ratio (SLR): 18.00%

These rates influence the interest rates on various loans offered by banks. For instance, the Marginal Cost of Funds-based Lending Rate (MCLR) for overnight loans ranges from 8.15% to 8.45%. Savings deposit rates are between 2.70% and 3.00%, while term deposit rates for periods exceeding one year range from 6.00% to 7.25%. 

The RBI employs Open Market Operations (OMOs) as a monetary policy tool to regulate liquidity in the economy. Through OMOs, the RBI buys or sells government securities in the open market to either inject or absorb liquidity. For example, on March 23, 2020, the RBI infused ₹1 trillion through term repo auctions as part of its OMOs to boost liquidity amid economic challenges. 

Regarding margin requirements, banks are mandated to maintain a certain percentage of their Net Demand and Time Liabilities (NDTL) as cash reserves with the RBI (CRR) and in the form of liquid assets like government securities (SLR). These requirements ensure liquidity and financial stability in the banking system.

Please note that these rates are subject to change based on RBI's monetary policy decisions. For the most current information, it's advisable to consult the latest updates from the Reserve Bank of India.