External benchmark-based lending must: RBI

News:The Reserve Bank of India (RBI) has made it mandatory for banks to link all new floating rate personal or retail loans and floating rate loans to MSMEs to an external benchmark rate from October 1st,2019. Facts: The RBI has given the options to banks for external benchmark rates which are (a) RBI repo rate… Continue reading External benchmark-based lending must: RBI

RBI plans to formalise linking of new loans to repo rate

The Reserve Bank of India(RBI) is considering asking banks to link loans to an external benchmark such as the repo rate to improve transmission of policy rates and foster economic growth. Repo stands for ‘Repurchasing Option’.It refers to the rate at which commercial banks borrow money from the RBI. Currently,bank loans are linked to marginal… Continue reading RBI plans to formalise linking of new loans to repo rate

New SBI rules link savings bank interest to repo rate: what has changed, why

State Bank of India (SBI) has linked its interest rate on savings account with balance above ₹1 lakh and short-term loans to Reserve Bank of India’s(RBI) repo rate. SBI had taken this decision even though RBI had deferred the plan to link the rate of interest to external benchmarks like the repo rate or Treasury… Continue reading New SBI rules link savings bank interest to repo rate: what has changed, why

Linking small loans to external benchmark after further talks

The Reserve Bank has said that it will hold further discussions with banks on linking interest rates on personal,home,auto and MSME loans with the external benchmark rates. In December 2018,Reserve Bank of India (RBI) had proposed a major change in the way banks price their loans.It had said that banks will have to link the… Continue reading Linking small loans to external benchmark after further talks

New loan pricing scheme may be put off

The Reserve Bank of India(RBI) may extend the deadline for banks to shift to the new loan pricing regime which was scheduled to be implemented from April 1.This new external benchmark rate will be applicable for floating rate loans extended to individuals and small businesses. Earlier,Reserve Bank of India (RBI) had proposed a major change… Continue reading New loan pricing scheme may be put off

SBI links savings account, short term loan rates to repo rate

State Bank of India (SBI) has decided to link its interest rate on savings account with balance above ₹1 lakh and short-term loans to Reserve Bank of India’s (RBI) repo rate. Repo stands for ‘Repurchasing Option’.It refers to the rate at which commercial banks borrow money from the RBI.It is one of the main tools… Continue reading SBI links savings account, short term loan rates to repo rate