Repo Rate or repurchase auction rate is one at which the Reserve Bank of India, buys back Government Securities, from the commercial banks, based on the level of liquidity, the central bank wants to maintain in the country's economy. The central bank uses this as a tool to increase or decrease the supply of money in the economy. Marginal Standing Facility (MSF), is a window for banks, to take money on credit from the central bank, by pledging Government securities, in the case of emergency, … [Read more...]
Difference Between Bank Rate and MSF Rate
In our monetary policy rate series, we have already discussed the CRR and SLR, Repo Rate and Reverse Repo Rate. So, in this session, we will go through the bank rate and MSF rate. The bank rate can be understood as the interest rate at which commercial banks borrow money from the central bank without any sale of securities. On the other hand, MSF Rate is the rate of interest at which commercial banks borrow funds overnight from the central bank, by giving government securities as … [Read more...]
Difference Between Repo Rate and Reverse Repo Rate
The two Liquidity Adjustment Facility with the Central Bank are - Repo Rate and Reverse Repo Rate. Repo Rate is the rate at which interest is charged by the central bank, i.e. Reserve Bank for granting loans to a commercial bank. As against, Reverse Repo Rate is the rate at which interest is given to the banks which park their excess money with the Reserve Bank of India. What is Repurchase Option Agreement? Repo is an abbreviation for the Repurchase Option Agreement. It is a contract between … [Read more...]
Difference Between CRR and SLR
Commercial banks are mandated to hold a fixed proportion of their average cash balance, as a reserve with the central bank, the amount of which should not be less than the specified percentage of Net Demand and Time Liabilities is called Cash Reserve Ratio (CRR). On the other hand, SLR or Statutory Liquidity Ratio is the amount which a commercial bank is required to maintain in the form of liquid assets, i.e. cash, gold and bonds, before extending loans to its customers. Basically, every … [Read more...]
Difference Between Training and Internship
Many a time, students juxtapose training for an internship, but there is a huge difference between the two, which they need to understand because it helps in creating their portfolio. Also, with this, the students can decide, which career path or domain is best for them. While training is a learning process in which attempts are made to increase the knowledge, skills and competencies of the trainee so that he/she can easily perform a specific job. On the other side of the coin, we have … [Read more...]
Difference Between Speed Post and Registered Post
Both speed post and registered post are postal services provided by India Post, to the general public, wherein the speed post is famous for its time-bound delivery and registered post is known for secured delivery. The fundamental difference between, speed post and registered post is that the former is address specific while the latter is addressee-specific. With the advancement in technology, the world has now become a global village with no 'boundary' word left in the dictionary. As it is … [Read more...]
Difference Between Speed Post and Courier
Speed post is a postal service provided by the nation's postal department, to facilitate time-bound delivery of letters, parcels, documents, and other important stuff. On the other hand, the courier is also an express service, provided by a private company and facilitates timely shipping of consignment and letters. Back in olden days, the only method to connect with our loved ones, friends, relatives and acquaintances, was to send letters, with the use of pigeons, which took days and … [Read more...]
Difference Between Sales and Marketing Executive
The sales executive is the most important link between the company and its clients, who offer products and services to the customers and negotiate contracts, so as increase profits. On the other hand, marketing executives, play a crucial role in every organization who work with other employees, such as market research team, distribution staff, advertising team and so on The marketing executives focus on maximizing profits by creating sales and providing those products to customers that match … [Read more...]
Difference Between Price, Cost and Value
In a commercial transaction, a product or service is exchanged for a price, between the buyer and seller. So, we can say that price is the amount to be paid, in order to get the product or service. There are many people who believe that price, cost and value of a product or service are one and the same thing, but there is nothing like that. Cost is basically the aggregate monetary value of the inputs used in the production of the goods or delivery of services. Conversely, Value of a product … [Read more...]
Difference Between Banker’s Cheque (Pay Order) and Demand Draft
Banker's Cheque or say pay order is an instrument, generally non-negotiable, issued by the bank on behalf of the customer, containing an order to pay a specified sum to the specified person, in the same city. On the other hand, demand draft is a financial instrument, used by people for the purpose of transferring money from one place to another. Whether it is a banker's cheque or a demand draft, the validation period of the two instruments is 3 months, i.e. after the expiry of three months, … [Read more...]