Prime Lending Rate is the rate of interest at which financial institutions can lend to the most worthy of their customers. This can be said to be the rate at which lending institutions will break even giving loans to their customer.
Most often, this rate is usually the basis at which financial institutions use to determine the rate to charge to their borrowers.
The rate of interest is usually plus (+) or minus (-) the Prime Lending rate.
To determine the PLR, banks usually put into consideration different factors like the Economy Interest rate , cost of handling fund, the cash reserve ratio and other factors to arrive at the Prime Lending Rate (PLR).
Prime Lending Rate is the rate of interest at which financial institutions can lend to the most worthy of their customers. This can be said to be the rate at which lending institutions will break even giving loans to their customer.
Most often, this rate is usually the basis at which financial institutions use to determine the rate to charge to their borrowers.
The rate of interest is usually plus (+) or minus (-) the Prime Lending rate.
To determine the PLR, banks usually put into consideration different factors like the Economy Interest rate , cost of handling fund, the cash reserve ratio and other factors to arrive at the Prime Lending Rate (PLR).
Hence, the PLR differs from Banks to Banks.