Business, Legal & Accounting Glossary
The base rate is the lowest rate of interest that a bank will charge. However loans are normally offered at a rate of x% above base rate depending on the risk profile of the borrower.
The base rate normally matches the Bankof England base rate, which is reviewed on a monthly basis by the Bank’s Monetary Policy Committee. The base rate is set at a level to meet the Government’s inflation target.
Base rate, sometimes referred to as repo rate, is the minimum rate at which banks are prepared to lend money – it acts as the benchmark for other interest rates, including personal loans and mortgages.
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This glossary post was last updated: 26th April, 2020 | 1 Views.