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Lending Rate Price To Be Benchmarked To External Rates From April 1

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Even as the central bank awaits more feedback on the recommendations of the Janak Raj Committee, the RBI may still wait further to discuss pricing of loans to external rates.

 

Lending Rate Price To Be Benchmarked To External Rates From April 1

However, the earlier decision in December 2018 meet to price loans to retail and SME borrowers as per the external benchmark will come into force from April 1, 2019.

Also in the Thursday's meet while the RBI governor has pressed bankers to swiftly pass on the repo rate cut to the end borrowers, bankers have promised to check upon the possibilities of effecting a lending rate cut.

Banks at the same time have explained the pricing of loans and the extent to which the repo rate cut and RBI's OMO impact lending rates charged to borrowers. "We explained how external benchmarking can be more robust and more acceptable to the banking system," a banker said.

RBI in its sixth bi-monthly MPC meet reduced repo rate by 25 basis point, and SBI has since been the only bank to transmit it as lower lending rate, reducing home loan rate by 5 basis points.

GoodReturns.in

Read more about: loan interest rate repo rate omo
Story first published: Friday, February 22, 2019, 11:03 [IST]
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