One image to understand: What is Treasury Reverse Repo? A lot of bros have been asking me, what is Treasury Reverse Repo? Today, I specially made an infographic to explain it to everyone. The full name of Treasury Reverse Repo is 'Bond Pledged Reverse Repo,' which refers to borrowers using the government bonds they purchased as collateral to borrow money, repaying the principal and interest upon maturity. Investors lend their funds through the Treasury repo market and earn fixed interest income. Simply put: You lend your idle money at a certain interest rate and for a certain term, while others use bonds as collateral. Upon maturity, they pay you interest and the principal, with the settlement guaranteed by the national clearing institution. Imagine this: Neighbor Lao Wang urgently needs money, so he pawns his gold bars (government bonds) to you, borrows 10,000 yuan, promises to repay the money + interest in 3 days, and retrieves the gold bars. This is reverse repo! ✦ You’re the 'big shot' lending money and earning interest (the fund lender) ✦ The collateral is government bonds (backed by national credit, safe!)