Loan interest is a clear explanation of a difficult term. What is loan interest - its concept and essence Loan interest receives monetary reward

One of the most important principles of lending is payment. The loan fee comes in the form of loan interest. And this is, first of all, the main purpose of loan interest. But its role goes far beyond measuring the value of the money being lent. It is this circumstance that is the basis for the loan interest to be highlighted in a separate chapter in this textbook.

Loan interest- This is the payment from the borrower to the lender for using the loan. We find this definition in almost every textbook on money, credit and banks.

But what is hidden behind this board? Why are interest rates different in different countries, in different banks in the same country, and even in one separate bank for different clients?

However, the essence and sources of loan interest are defined differently by representatives of different areas of theoretical economics. The most widespread in Western economic schools are the views of supporters of marginal utility and Keynesianism, views that are gradually penetrating the pages of domestic publications.

The first believe that loan interest is a psychological category - the price of capital paid for its use. Thus, the representative of the Austrian school Boehm-Bawerk (1851-1914) interpreted interest as a result arising from the psychology of “economic entities.” In his main work “Capital and Interest” (Vol. 2: Positive Theory of Capital, 1889), Böhm-Bawerk explained the existence of interest on psychological “foundations” associated with a higher assessment by consumers of current goods compared to future ones. The measure of the difference between these estimates, which is based on the principle of decreasing utility over time, is the level of interest.

The American economist Irving Fisher, portraying interest as a reward to the creditor for deferring consumption, stated: “It would be a mistake to condemn all interest as based on exploitation.” J.M. Keynes wrote that “the rate of interest is the reward for the deprivation of money for a certain period... The rate of interest at any time, being the reward for parting with liquidity, is a measure of the reluctance on the part of those who own money to part with direct control over it... It is the price that balances the insistence on holding wealth in the form of cash with the amount of money in circulation."

The author of the most popular textbook “Economics,” Paul A. Samuelson, defines interest even “simpler”: “Interest is the amount paid to the person who lends money. Interest rate (or rate of interest). The price paid for borrowing money for a specified period of time, usually expressed as a percentage of the principal per year."

From a quantitative point of view, indeed, “interest is the amount paid to the one who lends money... the price paid for borrowing money for a certain period of time...” And from a qualitative point of view, this is the price of what? Parting with liquidity? Or is this the price of refraining from using money as the most liquid asset? Or is it the price of the money lent? Obviously, we can only give a negative answer to all three questions.

Today, very often, both in our practical activities and in economic publications, we come across the definition of interest as the “price of money.” But this is also wrong. Say: 100 rub. cost 10 rubles. - this is economically incorrect.

Let's take a specific example. An industrial capitalist takes out a loan of 1 million rubles from a bank. and after a year returns, along with interest - 1.050 million rubles.

Loan interest 50 thousand rubles. But, firstly, 50 thousand rubles. cannot be worth 1 million. Secondly, in essence, there is no act of purchase and sale of money here. Money is not sold, but loaned for a period of one year, and the creditor bank remains its owner. So what is bought and sold in a credit transaction and what is the price of 50 thousand rubles?

The scientific answer to this question was given by K. Marx in Volume III of Capital. K. Marx emphasizes that the object of purchase and sale in a credit transaction is the specific use value of money as capital - the ability of money to turn into capital and generate profit.

Money as capital (or commodity-capital) differs from all other goods (except for commodity-labor power) in that if for all other goods the use value is consumed and at the same time the substance of the commodity disappears, and with it its value, then “commodity-capital” , on the contrary, has the peculiarity that, through the consumption of its use value, its value and use value are not only preserved, but also increased. It is this use value of money as capital - the ability to produce average profit - that the money capitalist alienates to the industrial capitalist for the period during which he transfers to the latter the right to dispose of loan capital."

When selling, the goods go to the buyer, and the money goes to the seller. Each of them remains the same value, only money and goods have changed their owners. In the case of a loan, only the lender gives away the value, but he remains its owner and receives it back upon expiration of the loan agreement. “The use value of loaned money is its ability to function as capital and as such to produce, under average conditions, an average profit.” “The value of money or goods as capital is determined not by their value as money or goods, but by the amount of surplus value that they produce for their owner.”

If our industrialist-borrower receives a profit in a year equal to 15%, then at the end of the year he must not only return the borrowed 1 million rubles, but also 50 thousand rubles. percent.

Consequently, the profit he received is 150 thousand rubles. (1,000,000 x 015/100) will be divided into the loan interest paid to the bank (50 thousand rubles) and business income of 100 thousand rubles. (150 thousand - 50 thousand rubles).

Consequently, loan interest is part of the surplus value that the functioning capitalist pays to the lender for the use of the loan. The ratio of the amount of loan interest to the amount of the loan, expressed as a percentage, is called the norm of loan interest and its rate.

In real life, there are many interest rates. From a substantive point of view, the division of interest rates into credit and deposit rates is of paramount importance.

Loan rates- These are the interest rates that the borrower pays for using the loan. For a bank, this is the resource allocation rate.

Deposit rates- these are interest rates paid by banks to depositors or rates of attracting resources.

Deposit and lending rates, in turn, are divided into rates for legal entities and individuals, in rubles and in foreign currency.

In addition, all listed rates are differentiated:

• by terms - short-, medium- and long-term;
• by role and structure - into main (basic) and secondary, which change after the main ones;
• by areas of application - domestic and international.

There are nominal and real rates, i.e. rates adjusted for inflation.

In global banking practice, such base interest rates as: LIBOR ( LIBOR - London Interbank Offered Rate) - the rate on short-term loans placed by London banks (usually for a period of 3-6 months) in the form of deposits with other first-class banks; L IBID ( LIBID - London Interbank Bid) - rate on short-term deposits attracted by leading London banks; MIBOR ( MIBOR - Moscow Interbank Offered Rate) - the average accepted interest rate (percent per annum) announced by the largest Moscow banks when selling interbank loans.

The most common rate at which lending between first-class banks in the Eurocurrency market is carried out today is LIBOR. Typically, LIBOR refers to rates in pounds sterling and US dollars. LIBOR rates are used internationally and in the domestic markets of many countries. In the Russian Federation, the cost of paying interest to banks on loans received in foreign currency is included in the cost of production at the rate of LIBOR plus three percent. Interest above this rate is paid from profits.

The level of interest rates on loans largely depends on the credit rating of the borrower. Therefore, the most preferential are the basic lending rates for first-class borrowers, which in the USA are called prime rate, in Western Europe they are called base rates, in Japan - standard rate. All other bank rates are tied to the base rates.

Recently, especially with the rapid development of consumer credit in the Russian Federation, the term “effective interest rate” is often mentioned. It refers to the average actual (not advertised) annual interest rate.

In addition, there are fixed and floating interest rates. First do not change during the entire term of the loan or deposit agreement, and second may change depending on an increase or decrease in the discount rate or refinancing rate in the Russian Federation.

Finally, in banking practice simple or compound interest is used. Simple interest is usually accrued on active transactions, complex - on passive ones. The purpose of applying interest on interest is to encourage depositors to roll over time deposits.

The amount of interest rates on active and passive operations of banks, the period, procedure, terms for accrual and payment of interest, as well as the mechanism for their collection are determined by the bank and the client in the loan agreement. Interest on deposits and loans is calculated in accordance with the Civil Code of the Russian Federation and Regulations of the Central Bank of the Russian Federation dated June 26, 1998 No. 39-P “On the procedure for calculating interest on transactions related to the attraction and placement of funds by banks and the reflection of these transactions in accounting accounts "

Interest is accrued on settlement, current, loan and deposit accounts and on citizens' deposits in the amounts and terms stipulated by the agreement, but at least once a quarter, and is paid in installments according to the payment (or repayment) schedule for the due interest rates established by the bank.

For placed funds, banks have the right to set individual interest rates based on the terms of placement (lending), the amount of funds placed and the risks associated with providing funds to a specific borrower client.

The legislation provides for different regimes for changing interest rates on time deposits and demand deposits.

According to Art. 838 of the Civil Code of the Russian Federation “the bank has the right to change the amount of interest paid on demand deposits”, unless otherwise provided by the bank deposit agreement. “If the bank reduces the amount of interest, the new amount of interest is applied to deposits made before the notification to depositors about the reduction in interest, after a month from the date of the corresponding notification, unless otherwise provided by the agreement.”

But “the amount of interest on a deposit made by a citizen, determined by a bank deposit agreement, on the terms of its issuance after a certain period or upon the occurrence of obligations stipulated by the agreement, cannot be unilaterally reduced by the bank, unless otherwise provided by law. Under an agreement of such a bank deposit concluded by a bank with a legal entity, the amount of interest cannot be unilaterally changed, unless otherwise provided by law or agreement.”

So, loan interest is part of the surplus value that a functioning capitalist pays to the lender for the use of a loan. It comes in the form of numerous interest rates.

Now we have to answer the main question that interests both lenders and borrowers: what determines the level of loan interest and its various variations - interest rates?

In the domestic literature, different approaches to this issue are analyzed. But, despite all the innovations in the development of credit relations, the theory and methodology of K. Marx remains undeniable. And despite all the speculations around the theory of marginal utility, the theory of “pure productivity of capital”, the Keynesian “theory of liquidity preference”, ultimately the authors come to the conclusions of K. Marx that, in contrast to commodity pricing, the basis for determining the rate of interest on loans is the relationship between supply and demand for loan capital.

Unlike other goods, loan capital is not sold in the strict sense of the word, but is given for temporary use. The use value of loan capital lies in its ability to bring profit to the owner. Therefore, loan interest, as a specific, irrational price of a commodity - capital, expresses not the value of the loan, but the use value of this peculiar commodity, i.e. ability to make a profit.

“If price expresses the value of a commodity, then interest expresses an increase in the value of money capital and therefore acts as the price that is paid for it to the creditor... The value of money or goods as capital is determined not by their value as money or goods, but by the amount of surplus value that they produce for their owner." If, in the sale of ordinary goods, the price is determined by their value, and supply and demand affect the deviation of the price from the value, then the loan interest does not express the value of the money lent and is determined primarily by the supply and demand of this specific product.

“If supply and demand are covered, then the market price of the product corresponds to its production price, i.e. in this case, it turns out that its price is regulated by the internal laws of capitalist production, regardless of competition, since fluctuations in supply and demand do not explain anything other than the deviation of market prices from production prices. The same goes for wages. If supply and demand cover each other, then their effect is destroyed and wages are equal to the cost of labor power. But the situation is different with interest on money capital. Competition here does not determine deviations from the law: there simply is no other law of separation other than the one dictated by competition.”

So, the level of loan interest determines the supply and demand of loan capital. However, this is rather a qualitative definition. Naturally, the question arises: is it possible to quantify it? Probably, perhaps, attempts to find this sought-after thing are not uncommon in textbooks and other publications. But since the authors neglected the teachings of K. Marx, in particular on this issue, the attempts turn out to be fruitless reasoning or meaningless images of the intersection of the demand and supply curves for credit.

But the loan interest is not equal to the cost of the loan. Let us repeat: the price of money as capital, i.e. loan interest is determined by the amount of surplus value that it produces for its owner.

So what determines the level of loan interest that a functioning capitalist pays to a loan capitalist?

Since interest on loans constitutes part of the surplus value produced by the capitalist, it is obvious that the rate of interest depends on profit. It is clear that in normal, ordinary conditions the upper limit of the rate is the rate of profit. If the rate of interest reaches the average rate of profit, it is obvious that the functioning capitalist will receive no business income and will have no interest in borrowing. “Since interest is simply that part of the profit which... the industrial capitalist must pay to the money capitalist, the maximum limit of interest is the profit itself, and the part going to the functioning capitalist would then be equal to zero. With the exception of certain cases where the interest may actually be greater than the profit, but then it cannot be paid from the profit - one could, perhaps, consider the maximum limit of interest to be all profit minus that part of it that comes down to supervision fees.

The minimum interest limit cannot be determined, since at a zero rate no lending capitalist will be interested in issuing a loan. “The minimum limit of interest,” wrote K. Marx, “cannot be defined. It can fall to any level. But then again and again counteracting circumstances appear and raise him above this relative minimum.”

Since the object of division between the lender and the borrower in a competitive economy is the average rate of profit, then, under the influence of fluctuations in supply and demand, the interest rate will slide down or up within the range from zero to the average rate of profit.

The level of interest is determined by competition not only between lenders and borrowers, but also by intra-industry competition between banks and the stock market for attracting and placing monetary resources, as well as inter-industry competition in the form of the flow of capital from the credit and financial sphere to the non-financial sphere and vice versa. If the rate of profit in manufacturing is lower than in the banking sector, then capital will migrate from manufacturing to banks, and vice versa.

One of the clearest examples of this was the large-scale issue of government securities in Russia in 1993-1996, when the yield on GKOs was significantly higher than in the banking sector, or 10 times higher than in industry. As a result, capital rushed into the state financial pyramid, which collapsed in August 1998.

In addition, the level of loan interest is affected by:

• international capital migration, the state of national currencies and balance of payments. A strengthening currency attracts foreign capital, contributes to an increase in demand for currency and an increase in interest rates;
• level and dynamics of inflation. Decrease in the purchasing power of money, as we saw in Chap. 3, leads to depreciation of funds returned to the lender and provokes an increase in loan interest;
• tax regime in different sectors of the economy and benefits for buyers of government securities;
• general state of the economy and risk factors. The higher the risks, the higher the level of loan interest;
• monetary policy of the state. The state can have both a downward and upward impact on the level of interest rates in the country, influencing them both directly by lowering or increasing the discount rate (refinancing rate in Russia), and indirectly by regulating mandatory reserve standards, refinancing commercial banks and open market operations (for more details, see Chapter 11);
• the state of the state budget, the scale and conditions of placement of government securities.

Loan interest is not only an important economic category, but also one of the most important tools for regulating the economy.

Firstly, this is the core mechanism for implementing credit relations. A decrease in loan interest stimulates credit expansion, expansion of production and consumption, growth of investment, employment, but can provoke inflation.

An increase in interest rates has opposite effects on investment, production and consumption.

Secondly, an increase or decrease in loan interest affects the migration of capital from country to country, the state of the balance of payments and the exchange rate. Moreover, this influence is ambiguous. Thus, an increase in the interest rate above the world average, on the one hand, attracts foreign investors, but, on the other, pushes domestic borrowers abroad, since the cost of credit there is lower than in the domestic market.

Thirdly, changes in lending rates affect intersectoral capital migration within the country.

Fourthly, the regulatory role of loan interest goes far beyond the scope of the lending process itself. It becomes the initial basis for assessing real estate, including land, housing, etc., its profitability, determining the stock price, etc.

For example, if we want to determine the price of a plot of agricultural land, then, knowing the amount of rent (say, 1 million rubles) or rent and interest on deposits - 5% per annum, we can easily determine the price of this plot of land. The price of this plot of land will be equal to

This means that the owner of the land, receiving a rent of 1 million rubles. per year, selling his plot for 20 million rubles. and putting them on a bank deposit, he will receive 1 million rubles annually.

With a par value of a share of any company of 1000 rubles, a dividend of 20% per annum and a deposit interest of 5%, the market price of the share should be

Right there. P. 3.

SUBJECT. LOAN CAPITAL MARKET

1. The concept of loan capital.

2. Loan interest. Loan interest rate.

3. Loan capital market, structure, functions.

4. Features of RSK.

5. Russian loan capital market.

The concept of loan capital

The need for credit is determined by the laws of circulation and circulation of capital in the process of reproduction, i.e. when temporarily free funds are released in one area, which can act as a source of credit, in another area, a need for these free funds arises. Credit - this is the movement of loan capital, therefore, loan capital - this is a special form of capital: an isolated part of industrial capital, the most important source of which is funds released from the circulation.

Loan capital has its own characteristics and differs from industrial and commercial capital:

1. Loan capital is capital property. With the formation of loan capital, capital split into property capital and capital function. Capital-property is transferred for temporary use in order to receive interest. And the capital function makes a circuit in the borrower’s enterprise and generates profit. The lender, in this case, acts as the owner of the capital that is used in other people's enterprises and his goal is to make a profit on the loaned value in the form of interest. The real expression of this property is the borrower’s obligation to repay the loan received on time with the payment of interest.

2. Loan capital is a kind of commodity; its use value lies in the ability to function as capital and generate income in the form of profit. Part of the profit -% or the price of loan capital is payment for this ability, in contrast to the price of ordinary goods, which represents the monetary expression of value.

3. Loan capital has a specific form of alienation. Unlike purchase and sale, where simultaneously goods move from seller to buyer, and money from buyer to seller, loan capital in a credit transaction is transferred unilaterally when a loan is granted from the lender to the borrower. And when it is repaid - from the borrower to the lender with the payment of %.

4. The movement of loan capital differs from the movement of operating capital. Industrial capital successively takes three forms: money, productive, commodity, making the circuit D-T P-T-D"

Trade capital takes two forms: commodity and monetary M-T-D". Loan capital is constantly in monetary form, since it is associated with the provision of money capital on a loan and its return with% (D-D"). When a bank gives a loan to an enterprise, the flow of funds in expanded form can be represented as follows: D-D-T-D1-D2. First part D-D means that the bank has given a loan to the company. D-T means that the enterprise spent it on production. T-D1 The company sold the products and made a profit. D1-D2 The company repaid the loan and paid the interest.

Therefore, for the lender, the movement of his loan capital can be represented in the form D-D." Here it is very important to understand the process of movement of value. If a loan in its final stage is a process of returning value, then interest is the movement of capital incremented to the loan, i.e. j. the advanced capital must not only remain in motion, but also increase, increase. From the above diagram of the movement of loan capital it follows that the final D2 is greater than the initially advanced capital, and this value is equal to the amount of interest.

5. Formula D-D1 does not include the production and circulation of goods and creates the appearance that money, by its very nature, can generate profit. In reality, the source of profit and interest is surplus value, i.e. part of the newly created value in the process of reproduction.

6. Since loan capital appears in monetary form, the appearance of money arises, but loan capital and money are different economic categories that have the following differences:

1) loan capital is a self-increasing value. Money, being a special commodity that is a universal value equivalent, does not in itself provide an increase in value.

2) In addition, there is a quantitative difference, which lies in the fact that the mass of loan capital exceeds the amount of money in circulation, because one monetary unit repeatedly acts as loan capital.

Thus, the main feature of loan capital as an economic category is the transfer of value for temporary use in order to realize its specific quality - the ability to generate profit in the form of%.

Loan interest. Loan interest rate

Loan interest is the fee received by the lender from the borrower for the use of borrowed funds. It is determined by the size of the loan, its term and the level of the interest rate. Loan interest arises where an individual owner transfers a certain value to another for temporary use. The creditor demands payment for borrowed funds because, by transferring his capital to the debtor, he himself is deprived of the opportunity to receive his own profit during this time. There is a close relationship between loan interest and profit. It manifests itself in the fact that both of these categories (profit and %) represent a certain part of the newly created value. This value has the characteristics of a product and its consumer value (utility) is that:

1) the profit received constitutes the income of the producer-borrower;

2) the lender's income in the form of %.

D’ – D = ∆D – increment to the loan, which is the payment for the loan. Thus, the goal of any credit transaction is to obtain a certain income on the loaned value; for an entrepreneur, this is to raise funds also in order to increase profits.

Loan interest arises on the basis of a loan and is a kind of loan price, which guarantees the rational use of the loaned value and the conservation of the mass of credit resources. Conclusion: loan interest is an objective economic category, which represents a unique price for the value lent for temporary use.

1. redistribution of part of the profit;

2. an incentive function, which is aimed at the efficient use of the loaned value, and from the position of the lender, the incentive function of the loan interest allows him to obtain maximum profit in conditions of market competition;

3. guarantee of preservation of the loaned value, i.e. return it to the creditor in full. When considering % in this function and avoiding losses (presence of risk!), many factors should be taken into account, and above all: the term of the loan, its size, the availability of loan collateral and timely fulfillment of obligations to repay it.

It may be higher with long loan terms (the risk of non-repayment increases due to changes in the economic situation, the financial condition of the borrower; the risk of lost profits from fluctuations in interest rates on the loan capital market, etc.) Dependence on the size - an increase in the risk of insolvency of the borrower. Undersecured loans are more expensive compared to secured ones. Loans issued to pay off financial difficulties have an increased risk. When determining the price of a loan, inflation is also taken into account.

The types of loan interest can be classified according to different criteria:

1) by loan form:

commercial %,

bank %,

consumer %,

for leasing,

for government loans, etc.

2) by type of credit institution:

Central Bank discount rate

pawn banking

3) by loan terms:

short-term;

mid-term;

long-term

4) according to the method of calculating %:

ordinary;

accurate, etc.

5) by type of operation:

deposit,

bill,

accounting %,

interest on loans,

interest on interbank loan,

6) by type of investment:

for loans to replenish working capital,

investments in fixed assets,

investments in the Central Bank.

The amount of loan interest is formed on the basis of the loan price + margin (a premium required to generate bank income). The interest rate is influenced not by the market cost of attracting resources, but by the real cost.

The difference between the market and real value of resources is due to the fact that:

1. a required reserve ratio has been established for commercial banks;

2. special methods for assigning interest to s/s are used;

3. taxes.

The interest margin, which is set by a specific bank, must cover costs, provide appropriate profits, and take into account risk and inflation.

Loan interest in all its forms is characterized by the following mechanism of use:

1. The level of loan interest is determined:

a) the relationship between supply and demand for credit;

b) the degree of profitability in various sectors of the financial market;

c) on the specific terms of the transaction;

d) the degree of inflationary depreciation of money!!!

2. The procedure for calculating and collecting interest is determined by agreement of the parties.

3. The source of interest payment depends on the nature of the transaction. The quantitative definition of interest is its rate or rate.

Interest rate– is the ratio of the annual income received on loan capital to the amount of the loan provided * 100.

For example, if a capital of $100 thousand is loaned, and the annual income from it is $12,000, then the rate is 12%.

1200/100000*100%=12%

The interest rate depends on the relationship between demand and supply of loan capital, which is determined by many factors:

1) scale of production;

2) the size of the population’s cash savings

3) the relationship between the size of loans provided by the state and its debt

4) cyclical fluctuations of the economy

5) inflation rate

6) government regulation

7) international factors, etc.

In conditions of market development, the level of loan interest tends to the average rate of profit in the economy, this is especially typical for industrialized countries. In our country, where the market is just being created and the profitability of various industries is very “varied,” a differentiated level of interest rates is established. Subject to the free flow of capital, it will flow into the industry that will ensure the greatest profit.

For example, if the level of income in production is higher than the loan interest, then funds will move from the monetary sphere to the production sphere.

For example, the profitability of the GKO market led to an outflow of funds from the sphere of short-term lending to the sphere of transactions with the Central Bank; with the fall in the profitability of GKOs, it rushed towards the dollar.

Taxation . The taxation system affects the amount of profit remaining with the enterprise. Thus, by changing the procedure for collecting taxes, tax rates, and applying a system of benefits, the state stimulates certain economic processes. This system is also valid for the monetary market.

Private factors are determined by the specific conditions of the lender’s activities, its position in the credit market, the nature of operations and the degree of risk. In addition, the formation of the level of individual forms of loan interest has its own characteristics.

Let's look at how changes in supply and demand will affect market interest rates. Suppose that borrowers expect an increase in the rate of inflation and a decrease in real borrowing costs. At this rate i e percent, demand for credit can exceed supply. The demand curve for credit shifts to the right, from position DD to position D`D` (Figure 2). Excess demand will put upward pressure on interest rates. On the other hand, creditors’ assumptions about an increase in inflation rates, i.e. A decrease in future returns on their assets will lead to a decrease in the supply of credit at a given interest rate, which will increase excess demand. The supply curve shifts to the left, to position S`S`. Some borrowers are deprived of the opportunity to obtain a loan, while others are forced to take out a loan at a higher interest rate than the current interest rate. As a result, the market will establish a new higher level of interest rates i e.

In this case, the equilibrium volume of credit in the economy may not change compared to the previous state of the market.

Figure 2. Shifts in supply and demand and the market interest rate

2. The economic essence of loan interest.

interest rates. Interest rate

- this is the relative amount of interest payments on loan capital for a certain period of time (usually a year). It is calculated as the ratio of the absolute amount of interest payments for the year to the amount of loan capital. Distinguish nominal And real interest rates. When people talk about interest rates, they mean real interest rates. However, actual rates cannot be directly observed. By concluding a loan agreement, we receive information about nominal interest rates. The nominal interest rate is interest in monetary terms. For example, if an annual loan of 10,000 rubles pays 1,200 rubles as interest, then the nominal interest rate will be 12% per annum. Having received an income of 1200 rubles on a loan, will the lender become richer? This will depend on how prices have changed during the year. If annual inflation was 8%, then the lender’s income actually increased by only 4%. The real interest rate is the increase in real wealth, expressed as an increase in the purchasing power of the investor or lender, or the exchange rate at which today's goods and services, real goods, are exchanged for future goods and services. The first to suggest that the market rate of interest will be directly influenced by inflationary processes I. Fisher

, which determined the nominal interest rate and the expected inflation rate.

The relationship between the rates can be represented by the following expression: , (1)

i=r+e i Where

– nominal, or market, interest rate; r

- real interest rate; e

– inflation rate. Only in special cases when there is no price increase in the money market, real and nominal interest rates are the same. Equation (2) shows that the nominal interest rate can change due to changes in the real interest rate or due to changes in inflation. Since the borrower and lender do not know what rate inflation will take, they proceed from the expected rate of inflation. The equation becomes:

i=r+e e, (3)

i=r+e e e– expected inflation rate.

Equation (3) is known as Fisher effect . Its essence is that the nominal interest rate is determined not by the actual rate of inflation, since it is unknown, but by the expected rate of inflation. The dynamics of the nominal interest rate repeats the movement of the expected inflation rate. It must be emphasized that when forming a market interest rate, it is the expected rate of inflation in the future, taking into account the maturity of the debt obligation, that matters, and not the actual inflation rate in the past.

If unexpected inflation occurs, then borrowers benefit at the expense of lenders, since they repay the loan with depreciated money. In the event of deflation, the lender will benefit at the expense of the borrower.

In the data characterizing the level of inflation in Russia in ... years (see Attachment), If we compare the actual inflation index with the dynamics of the average rate on short-term loans, we can confirm the existence of a relationship between the nominal interest rate and the level of inflationary depreciation of money.

Sometimes a situation may arise where real interest rates on loans are negative. This can happen if the inflation rate exceeds the growth rate of the nominal rate. Negative interest rates can be established during periods of runaway inflation or hyperinflation, as well as during an economic downturn, when demand for credit falls and nominal interest rates fall. Positive real interest rates mean higher income for lenders. This occurs if inflation reduces the real cost of borrowing (credit received).

Interest rates may be fixed And floating . Fixed interest rate is established for the entire period of use of borrowed funds without the unilateral right to revise it . floating interest rate - this is the rate on medium- and long-term loans, which consists of two parts: a moving basis, which changes in accordance with market conditions and a fixed value, usually unchanged throughout the entire period of lending or circulation of debt securities.

In the monetary sphere of economically developed countries, numerous interest rates are used. Gradually, in Russia, the structure of interest rates is approaching the international one. The interest rate system includes rates of the monetary and stock markets: rates on bank loans and deposits, treasury, bank and corporate bonds, interest rates on the interbank market and many others. Their classification is determined by a number of criteria, including: forms of credit, types of credit institutions, types of investments involving credit, loan terms, types of operations of the credit institution (Annex 1).

The main types of interest rates that both lenders and borrowers focus on include: base bank rate, money market interest rate, interest rate on interbank loans; interest rate on Treasury bills.

Let's look at some types of interest rates.

Basic bank rate - this is the minimum rate set by each bank for loans provided. Banks provide loans by adding a certain margin, i.e. a premium to the base rate on most retail loans. The base rate includes the bank's operating and administrative expenses and profit. The rate is set independently by each bank. An increase or decrease in the rate of one bank will cause similar changes in other banks.

Interest rates on commercial, consumer and mortgage loans . This type of rate is well known both to entrepreneurs who take out loans from banks to develop their business, and to individuals. The actual loan rate will be determined as the sum of the base rate and the premium. The premium represents a premium for the risk of default by the borrower, as well as a premium for the risk associated with the maturity of the loan. However, if in commercial lending the interest rate is known to the borrower in advance, then in consumer loans the real effective rate is veiled by various marketing ploys and burdened with additional deductions: for example, with an announced rate of 20% per annum, the real payment turns out to be much higher, sometimes reaching 80 - 100% per annum .

Rates on time deposits (deposits) of individuals and companies in commercial banks. The overwhelming majority of enterprises, as well as an increasing number of individuals, have accounts in commercial banks, place ruble funds in time deposits (i.e. deposits), receiving interest for this, expressed when concluding a deposit agreement in the form of an interest rate. Deposit rates on passive operations of banks are influenced by the same market processes as rates on active operations. Deposit rates are closely related to other rates in the monetary and stock markets. A legal entity that wants to deposit a certain amount of money can buy bonds on the organized market or promissory notes on the unorganized market. A deposit with a bank is more convenient in terms of registration, but the availability of alternative options for placing funds means that banks cannot lower interest rates on deposits too much.

Debt securities rates (bonds, certificates of deposit, bills, commercial paper, notes, etc.) refer to capital market interest rates. In debt securities there is an interest rate at which the borrower - the issuer of the security - borrows money. These rates are also very diverse: coupon on multi-year bonds, interest rate on bills and certificates of deposit, yield to maturity. Coupon rates indicate the interest income on the face value of the bonds. Yield to maturity shows interest income taking into account the market value of bonds and reinvestment of the resulting coupon income.

Loan interest is payment for the fact that the owner of capital refuses to use it independently and provides other people with the opportunity for its current, current use. In fact, the size of the loan interest can be called a kind of equilibrium point between the supply of available funds and the demand for these funds.
In simpler terms, loan interest can be called the price that must be paid to the owner of capital for its use. The period of time during which the borrower can use the loan is determined in advance.

Its value can be expressed using the interest rate (loan interest rate) for the year.

In its turn, interest rate is a certain amount of financial resources that must be paid for the use of one borrowed monetary unit during the year. A special formula is used to calculate the rate.

There are two separate types of interest rates: nominal and real.

• By the nominal lending rate, it should be understood that the rate is expressed in monetary units at the current exchange rate without taking into account the rate of inflation. This is a certain amount of financial resources that are paid per unit of borrowed currency for a previously agreed period of time. The nominal rate shows the relationship between the amount that the borrower must return to the lender and the amount that was previously received in the form.

In this case, the calculation is made using the following formula:

S = P (1+ ni), where
S - the amount of loan payments taking into account the initial debt (increased amount of debt);
P—original debt;
n is the duration of the loan in years or the ratio of the period of use of the loan in days to the applicable calculation base (360 or 365 days);
i is the interest rate.

• The real interest rate implies a rate that is expressed in certain monetary units, taking into account the pace of development. The real rate is one of the main factors in the decision-making process in the investment segment.

The interest rate level that takes into account inflation can be calculated in 2 ways:

Those close to you:

i f = i + f ,

where f is in percentage.

- precise:

i f = i + f + i * f / 100

The size of the loan interest depends on many factors - risk, the period for which the loan is provided and its security, the size of the loan provided and income, as well as current competitive conditions.

A feature of human behavior is the fact that an individual prefers today's benefits, albeit greater ones, to future benefits. This feature is called time preference. Temporal preference- the tendency of individual economic agents to prefer, other things being equal, the realities of today to future benefits. In order for the owner of capital to abandon its independent use today, he must be rewarded for such a refusal. Percent- payment for the fact that the owner of capital provides others with the opportunity for today's, current use of capital, refusing independent alternative use.

The interest rate is determined by the supply of accumulated funds and the demand for borrowed funds. Loan interest is the price paid to the owners of capital for the use of their borrowed funds during a certain period. Loan interest is expressed using the interest rate (lending rate) per year. Loan interest rate is the amount of money that must be paid for the use of one borrowed monetary unit per year. The loan interest rate is calculated:

where r is the loan interest rate; R is the lender's annual income; K is the amount of money capital lent out.

There are nominal and real interest rates. Nominal interest rate- loan interest rate, expressed in monetary units at the current exchange rate without taking into account inflation rates. This is the amount of money paid per unit of borrowed currency over a certain period of time. The nominal rate shows how much the amount that the borrower pays back to the lender exceeds the amount received as a loan. Real interest rate- loan interest rate expressed in monetary units adjusted for inflation. This rate is the main one when making investment decisions.

The value of the loan interest rate is influenced by a number of factors:

1. Investment project risk. Risk is an integral feature of a market economy. An entrepreneur takes a risk when he enters into a contract with a new supplier, establishes the production of a new product, develops a new market, etc. A lender takes a risk when he provides a loan to a little-known company; lends money to a well-known company investing in some new project, etc. The higher the risk that the borrower will not repay the loan, the higher the loan interest the lender will charge.

2. Loan period. The longer the period for which the loan is provided, the more lost opportunities the lender has to use these funds. In other words, long-term loan lenders are forced to abandon alternative capital investment options for a long period of time. In addition, the longer the period for which the loan is provided, the greater the likelihood that it will not be repaid, therefore, the higher the loan interest rate.

3. Loan security. Collateral is property or other valuables given by the borrower as security for a loan. If the loan is not repaid by the borrower, then the lender has the right to satisfy his claim from the value of the collateral. Collateral as security for a loan usually reduces the risk for the lender, and the lower the risk, the lower the interest rate will be.

4. Amount of loan provided. The interest rate on smaller loans is usually higher than on larger ones. This is explained by the fact that administrative and management costs in absolute terms for both small and large loans are the same. Since the costs of processing any loan are equal, the smaller the loan, the higher the interest rate should be.

5. Taxation of income (interest). Some forms of credit and lenders' earnings are taxable. The amount of tax is included by the lender as part of the interest. In other words, the higher the tax levied, the higher the interest rate. A lender may prefer a lower interest rate on a tax-free loan and reject a loan at a higher interest rate if the income received would be taxable.

6. Conditions of competition. The more banks (lenders) operate in a given territory, the higher the competition between them and the lower the loan interest rate. And vice versa, the larger the bank, the greater its monopoly power, the higher the interest rate.