Goodbye MIBOR, Hello SORR: Understanding RBI’s New Interest Rate Benchmark 04Oct2025

Goodbye MIBOR, Hello SORR: Understanding RBI’s New Interest Rate Benchmark 04Oct2025

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(The views expressed here are for information purposes only and should not be construed as a recommendation or investment advice. While the author is a CFA Charterholder with nearly 25 years of experience in financial markets, this content is intended to share general insights and does not constitute financial guidance. Please consult your financial adviser before taking any investment decision. Safe to assume the author has a vested interest in stocks / investments discussed if any.)

Abbreviations used:

FBIL Financial Benchmarks India Pvt Ltd

LIBOR London Interbank Offered Rate 

MIBOR Mumbai Interbank Offered Rate

RBI Reserve Bank of India 

SORR Secured Overnight Rupee Rate

SOFR Secured Overnight Financing Rate (the US)

TREPS Triparty or Tri-party Repos 

 

The Reserve Bank of India has introduced a new interest rate benchmark called SORR, which stands for Secured Overnight Rupee Rate. While it may seem like a technical change, this shift could have a big impact on the way India’s financial system works. 

 

1. What is SORR?

SORR is based on actual overnight borrowing transactions that happen in India’s secured money markets. In these markets, institutions borrow money overnight using government bonds or other approved securities as collateral. 

The rate at which they borrow is what SORR will track. This will make it a reliable indicator of the real cost of short-term funds in India's financial system.

 

2. Why Was SORR Introduced?

As of now, India has been using a benchmark called MIBOR, or Mumbai Interbank Offered Rate. MIBOR is based on trades in call money market which comprises just banks and primarily dealers.

However, this market represents only a small portion of overnight borrowing in India. Because MIBOR is based on low-volume call money market, it has been considered less representative of true market activity.

Any benchmark interest rate should be reflective of current market dynamics. A committee set up by RBI recommended an alternative benchmark, called SORR. The committee's recommendations were made public in Oct2024. 

The RBI committee on MIBOR Benchmark suggested FBIL or Financial Benchmarks India Pvt Ltd might develop a benchmark based on the secured money market (both market repo and TREP), that is, a Secured Overnight Rupee Rate (SORR). 

 

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The Building Blocks of India's Money Market: Key Segments You Should Know 30Sep2025

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3. Why the need for SORR? 

Post-LIBOR, there have been several changes in global funding markets. The US has introduced SOFR or Secured Overnight Financing Rate to replace the discredited LIBOR benchmark. 

SOFR indicates the cost of overnight borrowing in the US and is collateralised by the US treasury securities. 

Likewise, Switzerland introduced SARON or Swiss Average Rate Overnight to replace Swiss franc LIBOR.

SARON is a transaction-based overnight interest rate benchmark based on actual repo transactions secured by Swiss government bonds.

Bank of England administers SONIA (Sterling Overnight Index Average) as the UK’s official benchmark interest rate for sterling (GBP) markets. The UK wound down the LIBOR completely from Oct2024. 

These moves by the US, the UK and Switzerland are part of a global shift where many countries are replacing LIBOR with new, transaction-based benchmarks to improve market integrity and stability.

India is following international best practices by moving away from the MIBOR benchmark, which is based on unsecured call money markets, toward SORR — a new benchmark grounded in secured overnight lending transactions. 

This shift aims to enhance transparency, accuracy and credibility by reflecting real market activity, just as other countries have done by replacing LIBOR with secured, transaction-based rates like SOFR in the US and SARON in Switzerland. 

 

4. How Is SORR Different from MIBOR?

Unlike MIBOR, the Secured Overnight Rupee Rate (SORR) is based on actual transactions in the secured overnight market—specifically, the market repo and tri-party repo (TREPS) segments. 

These two together account for approximately 98 per cent of overnight money market volumes in India, making SORR a far more representative and reliable indicator of the true cost of overnight borrowing.

Why SORR Is More Trustworthy and Inclusive?

MIBOR is derived from the call money market, which now contributes just 2 per cent to overnight market volumes (FY 2024-25). 

In contrast, SORR reflects activity in the far more active and diverse secured markets, involving a broad spectrum of participants including banks, mutual funds, insurance companies, corporates and other financial institutions.

Over time, there has been a clear market shift from unsecured to secured lending, as participants increasingly prefer the safety and liquidity of repos. This shift underlines the relevance of SORR as a benchmark rooted in current market dynamics.

How SORR Is Calculated?

SORR is based on actual trades conducted during the first three hours of the trading day in:

Basket Repo: A type of repurchase agreement where borrowing is backed by a predefined "basket" of eligible government securities rather than a single specific security, allowing flexibility and ensuring high-quality collateral.

TREPS (Tri-party Repos): A secured market segment dominated by mutual funds on the lending side. Mutual funds compete directly with banks for household and corporate surpluses.

This methodology contrasts with MIBOR, which is calculated as the volume-weighted average rate of trades in the first hour of the call money market, an unsecured segment.

Regulatory Backing and Future Outlook

SORR has been developed by Financial Benchmarks India Pvt Ltd (FBIL) under the guidance of the RBI. Given its secured market base and broader participation, SORR is expected to be a more accurate barometer of overnight interest rates going forward.

Importantly, SORR is also likely to play an increasing role in interest rate derivatives markets such as:

> Overnight Index Swaps (OIS)

> Forward Rate Agreements (FRAs)

> MIBOR-based Total Return Swaps (TRS) 

FBIL currently publishes data on both overnight MIBOR as well as SORR. 

Table showing comparison of MIBOR and SORR > 

Click on the image to view better > 

 

To better understand the shift from MIBOR to SORR, the table aabove compares key features of both benchmarks. It clearly shows how SORR, with its secured and more liquid market base, offers better transparency, lower volatility and broader market participation.

As shown above, SORR is derived from a significantly larger share of the overnight market (98% vs. 2%) and involves a wider range of participants. This makes it more reflective of actual borrowing costs across the financial system. 

Moreover, because it's based on collateralised transactions, SORR offers lower volatility and better alignment with monetary policy transmission.

 

5. Does It Affect You?

For most ordinary people, SORR will not make a noticeable difference right away. Home loan EMIs, personal loans and fixed deposit rates are not directly linked to this new benchmark. 

However, in the background, financial institutions, bond markets and derivative markets rely on these reference rates to price products and manage risks. A more accurate and stable benchmark can indirectly lead to fairer pricing and greater market stability over time.

Question: Will my home loan EMI change?
Answer: Not directly. Most consumer loans are not yet linked to SORR.

Q: Who sets SORR?
A: It is calculated by FBIL based on actual market repo and TREPS trades.

 

6. When Will SORR Replace MIBOR?

As of now, the RBI has not announced a specific date when SORR will replace the existing overnight MIBOR. The transition from MIBOR to SORR will be gradual, allowing markets and institutions time to adjust. 

Financial Benchmarks India Ltd (FBIL) is responsible for developing and implementing SORR. During this period, both MIBOR and SORR will coexist.

 

7. Current status of SORR

FBIL started publishing the new risk-free SORR benchmark rate, on its website, effective from 07Jul2025. However, it stopped publishing the data publicly from 01Oct2025 -- meaning the data are now available only to paid subscribers. 

As suggested by the RBI Committee on MIBOR Benchmark, participants have been using, as per their preference, both interest benchmarks, namely, SORR and overnight MIBOR for their market transactions. 

 

8. Why Does It Matter in the Bigger Picture?

This move is part of a larger global trend. Countries around the world have been moving away from older, less reliable benchmarks such as LIBOR and replacing them with new rates like SOFR in the United States. 

These new benchmarks are typically based on secured, transaction-based data, making them more transparent and robust. India is now following a similar path with SORR.

9. Summary

While SORR may not impact your daily life immediately, it marks a quiet yet meaningful shift in how India’s financial system operates. By relying on real, secured market transactions, SORR introduces a more credible and transparent benchmark for overnight interest rates.

This transition lays a stronger foundation for future financial products, investment decisions and economic policymaking—improving trust in the system over time.

Notably, with Indian government bonds recently included in global benchmark indices such as those by Bloomberg and JP  Morgan, the adoption of a robust and transparent rate like SORR becomes even more relevant. It provides foreign investors with a more accurate and dependable measure of short-term funding costs.

Though the change won't happen overnight, it reflects a broader move toward a more resilient, inclusive and market-focused financial framework.

SORR represents a major evolution in India's benchmark rates. As the market increasingly favors secured lending, SORR is well-positioned to become the primary reference rate for overnight funding and short-term liquidity management in India.

If you're curious to learn more, you can look up the RBI’s monetary policy statement from December 2024 or visit the FBIL website, where updates on SORR’s development are being published.

 

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References: 

RBI Report of the Committee on MIBOR Benchmark 01Oct2024

RBI governor's statement on SORR introduction 06Dec2024 

RBI Monetary Policy Report Apr2025: Table IV:3 (page 66) Average Volume and share in overnight money market - call money market 2%; Market Repo 28% and Triparty Repo 70% share 

RBI press release on Revised Liquidity Management Framework 30Sep2025 - Overnight WACR will continue to be the operating target of RBI's monetary policy; LAF corridor of SDF and MSF, LAF policy repo rate, 7-day VRR/VRRR, CRR, etc.

RBI Determinants of Uncollateralised Money Market Volumes 23Jul2025 - call money, TREP, primary dealers, mutual funds, government flows, USD-INR forward premia, etc. 

FBIL Methodology document for SORR 

FBIL pricing of SORR data 

FBIL SORR data from 01Sep2025 to 30Sep2025: 

 

 

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Disclosure:  I've got a vested interest in Indian stocks and other investments. It's safe to assume I've interest in the financial instruments / products discussed, if any.

Disclaimer: The analysis and opinion provided here are only for information purposes and should not be construed as investment advice. Investors should consult their own financial advisers before making any investments. The author is a CFA Charterholder with a vested interest in financial markets.

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Jane Goodall: What Separates Us from Chimpanzees?

What Separates Us from Chimpanzees?

Jane Goodall 

TED 2003

 

Good morning, everyone.

First, let me say what a privilege it’s been to be part of this incredible gathering over the past few days. The talks, the ideas, the people — it's all been extraordinary. And in many ways, I’ve felt very at home here, because so much of what we’ve heard connects with my life’s work.

I’ve come directly from the deep tropical rainforest of Ecuador, a place so remote you need a small plane just to get there. I was with Indigenous people — faces painted, parrot feathers in their headdresses — people fighting to protect their home from oil companies, from roads, from the relentless march of so-called progress.

What struck me, and why I bring it up here, is that in the heart of that untouched rainforest, they had solar panels — the first in that part of Ecuador. With them, they powered a water pump so women no longer had to carry water from the river. They could store electricity in batteries, giving light for half an hour a day in each of the eight homes in the village.

And there was the Chief — resplendent in full regalia — sitting with a laptop.

(Laughter)

This is a man who only learned about the "white man" 50 years ago, and now he's saying, "We want to learn. We want healthcare, to speak other languages. We’re good at languages." They’re embracing selective parts of the modern world — like computers and solar power — while still fighting to protect their forest from exploitation driven by foreign debt, the World Bank, and corporations.

From that rainforest, I’ve come here — and now, I want to bring another voice to this TED stage. Not a human one, but the voice of the animal kingdom.

So let me offer a greeting, from a chimpanzee in the forests of Tanzania:

Ooh ooh ooh ooh ooh!

(Applause)

I’ve studied chimpanzees in Tanzania since 1960. In that time, technology has transformed how we work in the field. For example, by analyzing fecal samples, we can now do DNA profiling and finally know which males father which infants. It turns out chimpanzees have a very promiscuous mating system — so this opens up new research avenues.

We use GIS to map their ranges. We track deforestation using satellite imagery. We can record their behavior at night with infrared cameras. It’s remarkable what’s now possible compared to when I first sat in the forest with a notebook and binoculars.

In captivity, technology is also helping us learn about animal cognition. One chimp in Japan — named Ai, meaning “love” — works with a touchpad and screen. She’s 28 and faster than many humans at complex tasks. She loves using the computer and performs tasks even without food rewards — just for the satisfaction of doing better.

When I first arrived in Gombe, the chimps mostly ran away. But I’ll never forget the first time I watched one — David Greybeard — calmly using a blade of grass to fish termites from a mound. Sometimes, he’d strip leaves off a twig — modifying it.

That was tool-making.

At the time, science taught that only humans used and made tools. We were "man the toolmaker." But when I told my mentor, Louis Leakey, he said:

"Now we must redefine 'tool,' redefine 'man,' or accept chimpanzees as humans."

(Laughter)

Since then, we’ve observed nine types of tool use at Gombe alone. Across Africa, different chimp groups use different tools in different ways — and this knowledge is passed on through observation and imitation. That’s the very definition of culture.

What we’ve learned over the decades is that the line between humans and animals is not sharp. It’s a blurry, shifting boundary.

Chimpanzees have long childhoods — five years suckling, followed by years of emotional dependence. Their social lives are deep and complex. They form affectionate, lifelong bonds. They show compassion, altruism, and emotions that seem remarkably similar to our own: joy, fear, sadness, even despair.

Their communication is rich: they kiss, embrace, hold hands, pat backs, shake fists — in contexts similar to ours. They hunt cooperatively and share. Some recognize themselves in mirrors — a sign of self-awareness. They have a sense of humor.

So, we now know we’re not the only beings with personalities, minds, and above all, feelings.

And yet — despite how much they’ve taught us — chimpanzees are disappearing fast. A century ago, there were about two million. Today, perhaps 150,000 remain.

Why? The same reasons you’ve already heard today: deforestation, population growth, poverty, and greed.

The bushmeat trade is particularly devastating. Logging companies build roads into remote forests, and hunters follow. They kill everything larger than a rat, smoke it, and sell it in towns. It’s not subsistence — it’s commerce. Entire species are being wiped out, and so are the Indigenous cultures that depended on them.

The pattern is familiar: forests fall, species vanish, cultures erode.

When I look at Africa — my beloved Africa — I see spreading deserts, hunger, disease, overpopulation, and poverty.

Do you think the people of Easter Island didn’t know they were cutting down their last tree? Of course they did. But desperation drives shortsighted decisions. If you're starving, you cut the last tree hoping to make it just one more day.

So yes, the picture can seem bleak.

But one thing does separate us from the chimpanzees: language.

We can talk about the past, plan for the future, share ideas. And yet, with all that ability, we are destroying the planet. In some ways, those of us in the developed world are worse — because we know what we’re doing.

We bring babies into a world where water poisons them, air sickens them, and food is grown in toxic soil. And not just in poor countries — in many of ours. We all carry chemicals in our bodies that didn’t exist 50 years ago.

What are we doing?

Children in cities grow up in concrete jungles, never knowing real nature. No trees, no birdsong, no forest canopy — only screens and simulation.

Eventually, I had to leave the forest I loved, because the chimpanzees were vanishing. I knew I had to raise awareness. And the more I spoke, the more I realized how everything is connected: the destruction of nature, the suffering of people, the greed of wealthy nations, the despair of the poor.

And that despair — I see it everywhere, especially among young people. They say, “What’s the point? Nothing we do matters.” Some turn to apathy. Others to anger.

And when young people say to me, “You’ve compromised our future,” I feel deep shame.

That’s why, in 1991 in Tanzania, I started a program called Roots & Shoots.

Its message is hope.

Just like little shoots can break through brick walls, young people — even the smallest — can change the world.

Roots & Shoots now exists in over 60 countries, with thousands of groups. It empowers youth of all ages to take action in three areas:

• Care for people

• Care for animals

• Care for the environment

Kids choose their own projects: restoring rivers, building gardens, helping elders, saving shelter animals. And it works because they own it. They’re doing what they care about.

Technology plays a role, too — helping these youth connect, share success, or ask for help from peers in other countries. One group fails, another offers advice. It’s grassroots, it’s global, and it’s growing.

The philosophy is simple:

• No violence.

• Solve problems with knowledge, persistence, and compassion.

• Treat all life with respect.

Young people ask me, “Dr. Jane, do you really have hope for the future?”

Yes — because of the human brain. We created these problems. We can solve them.

Yes — because of nature’s resilience. Ruined rivers can be restored. Dead lands can bloom again.

Yes — because of the indomitable human spirit.
Look at Nelson Mandela — 27 years in prison, yet he emerged to forgive, to heal, to lead.

Even in the aftermath of 9/11, amidst fear and horror, there was compassion, courage, and love.

One woman gave me a little bell, made from a defused landmine from Cambodia — a killing field transformed into peace. She said, “Ring this when you speak of hope.”

So I do.

Because hope is not out there with politicians or institutions.

Hope is in our hands.
In your hands. In mine.
And in the hands of our children.

If we each live consciously — if we reduce our ecological footprints, and choose ethically — we can change the world. Maybe even overnight.

Thank you.

 

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The above is transcript of a speech (Ted Talks) made by Jane Goodall in Mar2003.

Jane Goodall dies on 01Oct2025.