An interest rate is the rate at which interest is paid by borrowers (debtors) for the use of money that they borrow from lenders (creditors). Specifically, the interest rate is a percentage of principal paid a certain number of times per period for all periods during the total term of the loan or credit. Interest rates are normally expressed as a percentage of the principal for a period of one year, sometimes they are expressed for different periods such as a month or a day. Different interest rates exist parallelly for the same or comparable time periods, depending on the default probability of the borrower, the residual term, the payback currency, and many more determinants of a loan or credit. For example, a company borrows capital from a bank to buy new assets for its business, and in return the lender receives rights on the new assets as collateral and interest at a predetermined interest rate for deferring the use of funds and instead lending it to the borrower.

Interest-rate targets are a vital tool of monetary policy and are taken into account when dealing with variables like investment, inflation, and unemployment. The central banks of countries generally tend to reduce interest rates when they wish to increase investment and consumption in the country's economy. However, a low interest rate as a macro-economic policy can be risky and may lead to the creation of an economic bubble, in which large amounts of investments are poured into the real-estate market and stock market. In developed economies, interest-rate adjustments are thus made to keep inflation within a target range for the health of economic activities or cap the interest rate concurrently with economic growth to safeguard economic momentum.

Rate may refer to:

Science and finance

Human growth

Other uses

Rates are a type of property tax system in the United Kingdom, and in places with systems deriving from the British one, the proceeds of which are used to fund local government. Some other countries have taxes with a more or less comparable role, for example France's taxe d'habitation.

Rates by country

Australia

Local government authorities levy annual taxes, which are called council rates or shire rates. The basis on which these charges can be calculated varies from state to state, but is usually based in some way on the value of property. Even within states, individual local government authorities can often choose the specific basis of rates - for example, it may be on the rental value of property (as in Western Australia) or on the unimproved land value (as in New South Wales). These rateable valuations are usually determined by a statutory authority, and are subject to periodic revision.

Canada

Rates are referred to as property taxes in Canada. These taxes are collected primarily by municipal governments on residential, industrial and commercial properties and are their main source of funding.

Rates (Portuguese pronunciation: [ˈʁatɨʃ]) is a Portuguese parish and a former township located in the municipality of Póvoa de Varzim. The population in 2011 was 2,505, in an area of 13.90 km². The township has records dating to the 13th century and, still today, it preserves landmarks such as the townsquare and a well-preserved and notable Romanesque temple.

History

Rates is a medieval township that developed around the Monastery of Rates, established by Henry, Count of Portugal in 1100 AD on the site of an older temple dating to the 9th century or earlier and with sculpture elements dating to the Roman empire. A Roman road crossed near the monastery.

Rates naming seems pre-Roman in origin. The town gained importance due to the legend of Saint Peter of Rates, mythical first bishop of Braga and martyr while attempting to convert Roman pagans to Christianity, becoming in a central place in the Portuguese Way of Saint James and the local myth was used by Braga archbishops to justify their primacy in Hispania.