The difference between RRR's interest rate reduction and interest rate reduction is that RRR's interest rate reduction is to reduce deposit reserve, while RRR's interest rate reduction is to reduce deposit interest or loan interest. The central people's bank is the main body of RRR reduction, and commercial banks are the main body of interest rate reduction. RRR's interest rate cut is aimed at commercial banks, while the interest rate cut is aimed at enterprises and individuals. RRR interest rate cuts can release the margin of commercial banks in the central bank and increase the total market funds. RRR cut interest rates in order to release the liquidity of banks and increase the money flow in the market. Reducing interest rates will not increase market funds, but it can change the flow of funds. Deposit reserve is the funds prepared by commercial banks for investors to withdraw funds. Every year, commercial banks deposit some funds with the Central People's Bank, which is called deposit reserve.

After cutting interest rates, that is, reducing deposit interest, depositors do not put their money in the bank, but are more willing to invest their money. The loan cost of enterprises and individuals will also be reduced, so that more people will tend to invest in loans. After the loan interest is reduced, more people will be willing to apply for loans.