Following the LIBOR scandal, a widespread search began for more robust, reliable alternatives to the benchmark rates. Many currencies now have new overnight financing rates such as SOFR for US dollar, ESTR for euros and TONAR or Tokyo overnight average rate for Japanese. SONIA for British pounds had already existed before the LIBOR scandal, but has now been adopted more widely as a benchmark rate. The key differences between these overnight rates and the traditional IBOR rates are twofold.

Unlike IBORS which offered term rates, e.g. one month, three month, et cetera, these new benchmarks only apply for overnight borrowing. They do not include a term structure by default, which means they reflect borrowing costs for overnight lending only. The new rates are transaction based, they're not survey based.

Instead of relying on a panel of banks to estimate or report their borrowing costs, these rates measure the actual rates at which banks borrowed funds on a given day. This ensures the rates are more representative and less prone to manipulation.

All of these rates shown are volume weighted average rates. While these rates all share common features, there are important differences between them. Of course, each rate applies to a specific currency, dollar, euro, pound, yen, but they also differ in the type of underlying transactions. For example, in the US software is based on repos, collateralized borrowing backed by US treasuries, making it inherently more secure. In contrast, SOFR, ESTR and TONAR are based on unsecured overnight borrowings, which carry slightly more credit risk than SOFR because they are not backed by collateral.

In this sense, SOFR is technically more risk-free compared to the others as its underlying transactions are secured by highly liquid assets, US treasuries, whereas the others are based on unsecured lending, and of course, the publisher as well as publishing time differ as well.