For the borrower, a repo is a secure investment opportunity with low-risk securities such as government bonds. Financial institutions engage in repo transactions to meet short-term cash needs. So, what exactly is a repo transaction? Repo/reverse repo transactions are investment instruments used by organizations seeking funding through the sale/purchase of financial instruments with a commitment to repurchase/sell. Repo involves selling a security with a repurchase promise at the initiation date and repurchasing the security on the maturity date; while reverse repo involves buying a security with a resale promise at the initiation date and reselling the security on the maturity date. There are different repo/reverse repo markets in the Debt Instruments Market where various securities are traded.