Explanation:

A bank rate is the interest rate at which a nation's central bank lends money to domestic banks, often in the form of very short-term loans. Managing the bank rate is a method by which central banks affect economic activity. The Reserve Bank of India increased the Repo Rate again on the 1st of August 2018 from 6.25% to 6.50%. Even the reverse repo rate was increased to 6.25% from 6%, and the Marginal Standing Facility Rate went up by 25 basis points to 6.75% from 6.50%. Loan vs. Securities – As already discussed, bank rate usually deals with loans, whereas, repo or repurchase rate deals with the securities. The bank rate is charged to commercial banks against the loan issued to them by central banks, whereas, the repo rate is charged for repurchasing the securities.