Indian Bank to Link Retail & MSME Loans to RBI's Repo Rate from October 1

New Delhi, Sep 25 (PTI) State-owned Indian Bank on Wednesday said it has decided to link all new floating rate retail as well as MSME loans with the Reserve Bank of India's (RBI) repo rate, effective October 1.

The RBI has mandated all banks to link their loans with external benchmarks, such as repo, aimed at faster transmission of rate cuts effected by it to consumers.

"In conformity with the RBI guidelines dated September 04, 2019, on External Benchmark Based Lending, the bank has decided to link all new floating rate loans to personal or retail segment and new floating rate loans to micro and small enterprises (MSE), to Reserve Bank of India policy Repo Rate with effect from October 1, 2019," according to a BSE fling.

Several banks, including State Bank of India, have already announced to link their loan products with external benchmarks from next month.

(The above story is verified and authored by Press Trust of India (PTI) staff. PTI, India’s premier news agency, employs more than 400 journalists and 500 stringers to cover almost every district and small town in India.. The views appearing in the above post do not reflect the opinions of LatestLY)