---
title: "Call Money Market: Overnight Interbank Lending"
description: "The call money market is where banks lend each other unsecured funds overnight; the weighted average call rate is the RBI's operating target. See how it works."
url: "https://modeldiplomat.com/learn/glossary/call-money-market"
---

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Model Diplomat Research Team · Last reviewed June 22, 2026

TL;DR

- The call money market is the segment of the money market where banks borrow and lend unsecured funds among themselves on an overnight basis.
- What is the difference between call money and notice money?
- Who can participate in the call money market in India?
- Why is the weighted average call rate important for monetary policy?
- How does the call money market differ from the market repo or TREPS?

[Civil Service & Diplomatic Exams](https://modeldiplomat.com/learn/civil-services/glossary)Updated June 22, 2026

The call money market is the segment of the money market where banks borrow and lend unsecured funds among themselves on an overnight basis.

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In September 2018, following the IL\&FS default, the weighted average call rate in Mumbai's interbank market spiked sharply, prompting the Reserve Bank of India to inject liquidity through open market operations and term repo auctions to restore order.

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