DEFINITION of 'Mumbai Interbank Bid Rate - MIBID'
The interest rate that a bank participating in the Indian interbank market would be willing to pay to attract a deposit from another participant bank. The MIBID is calculated everyday by the National Stock Exchange of India (NSEIL) as a weighted average of interest rates of a group of banks, on funds deposited by first-class depositors.
BREAKING DOWN 'Mumbai Interbank Bid Rate - MIBID'
This would be the interest rate that one participating bank would pay another to attract the deposit of funds. The MIBID rate would be lower than the interest rate offered to those wanting to borrow funds, known as Mumbai Interbank Offered Rate (MIBOR). This is to provide the bank a profit from the spread of interest earned and paid.