Reverse Repo 2014 rate latest 2014 Reverse repo money floating in the banking system

The  purchase of securities with the agreement to sell them at a higher price at a specific future date.

For the party selling the security (and agreeing to repurchase it in the future) it is a repo for the party on the other end of the transaction (buying the security and agreeing to sell in the future) it is a reverse repurchase agreement. Reverse Repo rate is the rate at which banks park their short-term excess liquidity with the RBI.

  The RBI uses this tool when it feels there is too much money floating in the banking system.

  An increase in the reverse repo rate  means that the RBI will borrow money from the banks at a higher rate  of interest. An increase in the reverse repo rate  means that the RBI is ready to borrow money from the banks at a higher rate  of interest. As a result, banks would prefer to keep more and more surplus funds with RBI.

To borrow from RBi bank have to submit liquid bonds /Govt Bonds as collateral security ,so this facility is a short term gap filling facility and bank does not use this facility to Lend more to their customers