Bank Loan: 4 government banks made loans cheaper for bank customers, know the new interest rate here

RBI: After the Reserve Bank of India (RBI) recently cut the repo rate by 25 basis points i.e. 0.25 percent, many major government banks of the country have announced a reduction in interest rates on their loans. This is the second consecutive time this year that RBI has reduced the repo rate

RBI: After the Reserve Bank of India (RBI) recently cut the repo rate by 25 basis points i.e. 0.25 percent, many major public sector banks of the country have announced a reduction in interest rates on their loans. This is the second consecutive time this year that RBI has reduced the repo rate. After this move, State Bank of India (SBI), Punjab National Bank (PNB), Indian Bank and Bank of India have revised their external benchmark-linked lending rate (EBLR) or RLLR.

What will be the benefit to the loan takers?

The reduction in repo rate directly affects those customers who have taken loan on floating interest rate. The reduction in repo rate reduces the interest rates charged by the banks, which provides relief in EMI to the customers. Most of the banks have now linked the retail loan rates to the repo rate fixed by RBI, due to which this change gets implemented quickly.

What is RLLR?

RLLR i.e. Repo-Linked Lending Rate is the rate at which banks lend to customers. According to the circular issued by RBI in October 2019, it has been made mandatory to link all retail loans to an external benchmark. Most banks have chosen the repo rate as their benchmark.

Major banks reduced interest rates

SBI: India’s largest public sector bank SBI has reduced its EBLR from 8.90% to 8.65%. The new rates will be effective from April 15, 2025.

PNB: PNB has also reduced its RLLR from 8.90% to 8.65%. There is no change in the bank spread (0.20%), bringing down the final interest rate for customers from 9.10% to 8.85%.

Indian Bank: Indian Bank has reduced its RBLR from 9.05% to 8.70%. These rates are effective from April 11, 2025 and will remain in force till the next review.

Bank of India: Bank of India has also reduced its RBLR rate from 9.10% to 8.85%. This new rate has been implemented from April 9, 2025.

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