What is the Bank of Russia refinancing?It is a matter of concern to economists and speculators and traders, and even representatives of the banking sector.We can say that the rate appears in the form of money supply by the Central Bank of the Russian Federation of smaller financial institutions.Central Bank provides loans to commercial financial institutions, which then lend to individuals (citizens) and legal entities (companies, enterprises and organizations).
refinancing rate in practice
In order to thoroughly understand what the Bank of Russia refinancing, consider the mechanism of movement of cash flows.Commercial financial institutions take the CBR money in debt.For example, a million dollars.A year later, the small party of the financial system should return the Central Bank borrowed a million dollars plus interest for its use.The current refinancing rate of the Bank of Russia and will thus percentage that must pay the fine commercial bank, in addition to the principal.During the year, while the small financial institution uses the money CBR, it gives loans to individuals and businesses by a percentage that is much higher refinancing rate.The difference between the rate of the Central Bank and the interest rate at which money gives commercial structure, and there is profit last.The population is credited, and all participants receive their income scheme.
Why CBR does not work directly with the citizens of the country?
CBR works with private and legal persons directly because the volume of the smallest financial transactions he makes millions, or even tens, hundreds of millions of dollars.Such amounts for entrepreneurs simply unmanageable.Small financial institutions to act as intermediaries in the peculiar structure of lending.For financial institutions - an opportunity to make money.Users, in turn, receive quality financial services through an extensive system of branches and offices, the presence of structures with large number of ATMs.Assume that the size of the refinancing rate of the Bank of Russia will be equal to 10%.In this case, the population and entrepreneurs will receive loans under 18%.As a result, bankers will receive a net profit of 8% of the total payment for the use of funds.
allowed if their population by issuing a large percentage of the maximum?
Smaller financial institutions can borrow money from the Central Bank at low interest rates, and the public they can already transfer money on the interest that they want.In theory, such a possibility exists.However, you need to pay attention also to the competition, which has recently been in the Russian financial sector over tightening.Too high interest rates deter customers.We have reviewed about what the Bank of Russia refinancing.It happens that she is several orders of magnitude lower than that available to the ordinary citizen of the country.Moreover, the proposals of the majority of commercial structures do not differ much.There are exceptions in the market.For example, credit institutions involved in consumer lending in large stores and credit cards through can establish rate from 30 to 70%.Finding clients is based on the psychology of people who want to buy something.They, because of the lack of financial literacy, agree on so little benefit partnership.
How is the rate of refinancing?
refinancing rate of the Central Bank of Russia is determined by taking into account two factors.This is the actual economic situation in the country and the rate of inflation.An increase in the level of inflation and the rate is increasing.By lowering the inflation it is reduced.The situation can be considered from the other side.When the interest rate Bank of Russia refinancing is low, the population has the opportunity to enjoy the benefits of low-cost loans.Bids on them at this time significantly lowered, people are reluctant to cooperate because they can buy whatever they want, at a minimum overpayment.Some benefits obtained and businesses that might request funding for their activities.Engaging in the business of "cheap" money makes it possible to produce large volumes of products with a high profit further after implementation.As
rate reflects the economic condition of the state?
refinancing rate of the Central Bank of the Russian Federation acts as a kind of indicator of the state of the economy and people's living standards.With low interest rates on loans people have on hand a large amount of funds.It generated a great demand for the goods in connection with the possibility of their buying.As a result, after the time the goods are starting to go up in price because of their lack.The situation activates inflation.This process of devaluation of money, reflecting the opportunity to purchase a number of different products in the same amount.Most inflation reflects the welfare of the people.The higher the score, the lower the higher the level of welfare and discontent.The refinancing rate of the National Bank is constantly changing, because using them is adjusted inflation.To stop the depreciation of money, the rate rises, which leads to a rise in the cost of loans, a reduction in demand and a decrease of purchasing power.
Communication rates and tax
addition to lending, the refinancing rate of the Central Bank of the Russian Federation is actively used in the field of taxation.For example, it should be said about the taxation of income from deposit accounts, the interest on which is higher than the refinancing rate by more than 5 percentage points.For example, if the refinancing rate will be equal to 10% and the deposit rate of 15%, it is not necessary to pay the tax.If the deposit rate will be equal to 20%, the state will have to pay tax at a rate of 35% of the excess of 5% of the deposit.
Communication rates and the responsibilities of employers
considering the question, what is the rate of refinancing of the bank of Russia, it is worth mentioning that it acts as a tool, which is the basis for determining the compensation, which put the employee at the late payment of wages, with a delay of holidayor funds that must pay workers in case of dismissal.In accordance with Russian legislation, the employer must pay the full amount of the debt, to which is added the monetary compensation, calculated on the basis of the rate.It will not be less than 1/300 of the refinancing rate for each day of delay.The index used for the calculation of fines, which is charged as a penalty in the tax evasion and other charges.
rate in Russia
current situation in the world makes its own rules.The acute economic crisis has forced Russian banks increasingly seek financial assistance from the Central Bank.Lending to allow them to comply fully with its obligations to customers.Provision of funds for interest to commercial structures called refinancing.For the first time the refinancing rate Bank of Russia appeared in 1993.Within 10 years, she regularly changed.Russia has always sought to maximize the reduction of this index up to the level of leading countries.In particular, in Japan the rate is 0.1%, which fully reflects the high level of development of the state.In Russia, the interest rate is 8.25%, which numerically is radically different from the rate of America, on the facts of the situation in countries as varied greatly.
What is the rate of refinancing, in fact?
In theory, the refinancing rate in Russia is to be the most powerful tool for conducting monetary policy.Change it should be carried out in order to regulate the amount of money, the amount of which has an impact on all countries.You can note that the tool is not used, since the last rate change took place in 2012.Not working in the field of monetary policy, the rate places a mark on the fiscal.Regulation of the amount of funds in the country at the expense of emissions.In reality, the size of the index and the volume of assets - the value of non-interacting at all.To say more, they are almost completely opposite and do not reflect each other.Many analysts see the situation the problem of underdevelopment as the rates and reserve requirements.Even businesses borrow money from the Central Bank, starting from the one-day repo rate.According to this indicator issued loans to individuals and legal entities.It may be noted that the refinancing rate by no more than a formality, a declarative tool that does not have a good impact on the monetary policy of the state.
