What does Base Rate mean?

The Base Rte is an index set generally by the banks, and this index points out the minimum affordable rate by which they can lend money. The base rate is not only an index which comes into close relation with the banking system, but it is a stipulation which can be found when contracting personal loans or mortgages for example. In the industry of banking, the Bank of England is the main institution which notifies the rest of the banks about the base rate employed. The day’s financial operations in the major banks are also important criteria in how the base rate fluctuates.