Rbi policy: What will be the impact of a further rise in the repo rate on your loan issuance?
You should evaluate the personal loan interest rates offered by several NBFCs and banks before applying for a personal loan from a certain bank. However, while choosing to get a personal loan or a home loan, many people approach the bank where they have their main account. When you compare the interest rates of different banks, you may find that another bank gives personal loans and home loans at a much lower rate.
The Reserve Bank of India (RBI) raised the repo rate by 40 basis points to 4.40% on May 4 from 4% previously. A basis point is one hundredth of a percentage point. The repo rate was reduced in May 2020 and remained stable until the recent hike. In addition, the cash reserve ratio (CRR) was increased by 50 basis points, which put additional upward pressure on interest rates. As the increase took effect immediately, borrowers could expect higher EMIs, while FD investors should expect higher returns on new FDs.
Meanwhile, according to a Mint analyst poll, the RBI could raise the repo rate by 50 basis points and improve the cash reserve ratio (CRR) at its meeting this week to control inflation. . The central bank’s Monetary Policy Committee (MPC) will meet June 6-8.
According to five out of 10 economists polled by Mint, MPC is expected to raise the repo rate from 4.4% to 4.9%, with the rest expecting a 35-40 basis point hike to 4.75-4.8 %. Half of those surveyed expect a 25 to 50 basis point increase in CRR, the percentage of deposits that banks must hold in reserve with the RBI.
Moreover, with retail inflation reaching 7.79% in April, the government announced several measures to contain the prices of essential goods, banning or restricting exports of wheat, sugar and iron ore. Consequently, the majority of economists expect the monetary policy committee to revise its inflation forecast upwards.
The EMI for fixed rate loans, such as auto and personal loans, remains the same for the life of the loan. Therefore, the timing of your loan application is crucial. When you take out a low-interest loan, you can keep that rate for the life of the loan, even if the general interest rate goes up.
In contrast, for mortgage borrowers, the timing of taking out the loan is less critical as they typically borrow at variable rates. Rising rates may not have a substantial impact on interest payments and EMI payments. As a result, even if you enter at a cheaper rate now, you’ll have to pay a higher rate later if the lender raises their interest rates.
You don’t have to worry about the repo rate if you have an existing fixed rate loan. However, if you have floating rates on an existing loan or are planning to take out a loan – fixed or variable rate, you may have to pay a higher rate if the RBI raises the repo rate further.
Present the rates of personal loans in different banks
| Bank | Interest rate (pa) | Processing fee |
| Capital Aditya Birla | 14% per year -26% per year | Up to 2% |
| Axis Bank | 12% per year – 21% per year | At the discretion of the bank |
| Bank of Baroda | 10.50% per year – 12.50% per year | Up to 2% |
| Bank of India | 10.35% per year – 12.35% per year | Up to 2% |
| Bank of Maharashtra | 9.45% per year – 12.80% per year | Up to 1% |
| central bank of india | 9.85% and above | Up to 1% |
| Citibank | 9.99% per year – 16.49% per year | Up to 3% |
| city union bank | 12.75% per year | 1.00% subject to a minimum of Rs.250 |
| federal bank | 10.49% per year – 17.99% per year | Up to 3% |
| Fullerton India | 11.99% per year – 36% per year | Up to 6% |
| HDFC Bank | 10.5% per year – 21.00% per year | Up to 2.50% |
| Real estate loan cash loan | 19% per year – 49% per year | 0%-5% |
| HSBC Bank | 9.50% per year – 15.25% per year | Up to 1% |
| IDBI Bank | 8.15% per year – 10.90% per year | Contact the bank |
| First IDFC Bank | 10.49% per year and more | Up to 3.5% |
| IIFL | 24% per year and more | 2% and more |
| Overseas Indian Bank | 9.30% per year – 10.80% per year | Up to 0.50% |
| IndusInd Bank | 10.49% per year – 31.50% per year | 3% and more |
| J&K Bank | 10.80% per year | Up to Rs.500 |
| Bank of Karnataka | 12% per year – 17% per year | Maximum of Rs.8,500 |
| Karur Vysia Bank | 9.40% per year – 19.00% per year | 0.30% and more |
| Kotak Mahindra Bank | 10.25% and more | Up to 2.5% |
| National Bank of Punjab | 7.90% per year | Up to 1.00% |
| RBL Bank | 14% per year – 23% per year | Up to 3.5% |
| Bank of South India | 10.60% per year – 18.10% per year | Up to 2% |
| National Bank of India | 9.60% per year – 15.65% per year | Up to 1.50% |
| Tata Capital | 10.99% and more | Up to 2.75% |
| TurboLoan Powered by Chola | 15% – 21% (fixed) per year | 3.00% |
| Ujjivan Small Finance Bank | 11.49% per year – 16.49% per year | At the discretion of the bank |
| Yes Bank | From 10.99% per year – 16.99% per year | At the discretion of the bank Up to 2.50% |
Source: BankBazaar
Present the mortgage rates in different banks
| Financial Avails | 8.00% | 1.00% |
| Aditya Birla | 9.00% | 1% |
| Axis Bank | 6.90% | Rs. 10,000 |
| Bandhan Bank | 6.40% -13.50% | 1% (Rs.5,000) |
| Bank of Baroda | 6.90% to 8.25% | Contact the bank for more information |
| Bank of India | 6.90% | – |
| Bank of Maharashtra | 6.80% | Rs. 10,000 |
| Canara Bank | 7.05% per year to 9.30% per year | 0.50% of the loan amount subject to a minimum of Rs. 1,500, and a maximum of Rs. 10,000 |
| central bank of india | 6.85% | Rs. 20,000 |
| Citibank | 6.75% | Rs. 10,000 |
| DBS Bank | 7.30% | 0.25% (10,000 rupees) |
| Dhanlaxmi Bank | 7.85% | Rs. 10,000 |
| Housing finance dhfl | 8.75% | Rs.2500 |
| federal bank | 7.65% | Rs. 3,000 rupees. 7,500 |
| GIC Housing Finance | 7.45% | Rs. 2,500 |
| HDFC LTD | 7.00%* | Rs. 3,000 rupees. 5,000 (plus tax)* |
| HSBC Bank | 6.45% | 1% (10,000 rupees) |
| Hudco home loan | 9.45% | N / A |
| IDBI Bank | 6.75% | 0.50% (2,500 rupees – 5,000 rupees) |
| First IDFC Bank | 6.50% | Rs. 5,000 rupees. 5,000 |
| IIFL | 10.50% | 1.25% |
| Housing Finance in India | 12.00% | 2.00% |
| Indebulls | 7.60% | 0.50% and more |
| Overseas Indian Bank | 7.05% | 0.50% (Max Rs. 20,000) |
| Bank of Jammu and Kashmir | 7.20% | Rs.500 Rs.10,000 |
| Bank of Karnataka | 7.50% | Rs.250 |
| Karur Vysia Bank | 7.20% | Rs.5,000 |
| Kotak Mahindra Bank | 7.00% per annum to 7.60% per annum | 0.50% |
| LIC Housing Finance | 6.90% | Rs. 10,000 -Rs. 15,000 |
| GNP housing finance | 6.99% | Up to 0.50% |
| Bank of Punjab and Sindh | 6.85% | Full Waiver |
| National Bank of Punjab | 6.50% | 0.35% (Max Rs. 15,000) |
| Reliance real estate financing | 9.75% | Rs. 3,000 rupees. 6,500 |
| Saraswat Bank Home Loan | 6.70% | None |
| Sriram housing | 8.90% | N / A |
| Bank of South India | 7.85% | 0.50% (Rs. 5,000 – Rs. 10,000) |
| Standard Chartered Bank | 7.99% | 1% |
| National Bank of India | 7.05% per year -10.85% per year | 0.35% and more |
| Sundaram Real Estate Finance | 6.95% | Rs.3,000 (for employees) |
| Commercial Bank of Tamilnad | 8.25% | Rs. 15,000 |
| Tata Capital | 6.90% | 0.50% |
| UCO Bank | 6.50% | 0.15% (Rs. 1,500 – Rs. 15,000) |
| Union Bank of India | 6.90% | – |
| United Bank of India | 8.00% | 0.59% (1,180 rupees – 11,800 rupees) |
| Yes Bank | 8.95% | 1% (10,000 rupees) |
Source: BankBazaar
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