Loan EMIs Set to Drop as Home, Car, and Personal Loans Turn Cheaper After RBI Rate Cut
Following the Reserve Bank of India’s recent decision to cut the key repo rate by 25 basis points to 6%, several leading banks have swiftly adjusted their lending and deposit rates to align with the central bank’s policy shift.
New Delhi: Following the Reserve Bank of India’s recent decision to cut the key repo rate by 25 basis points to 6%, several leading banks have swiftly adjusted their lending and deposit rates to align with the central bank’s policy shift. The move is expected to provide relief to borrowers while ensuring competitiveness in the financial sector.
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Banks Respond to RBI’s Repo Rate Cut
Bank of Maharashtra was among the first to act, announcing a reduction in its repo-linked lending rate (RLLR) from 9.05% to 8.80%, making loans more affordable for its customers.
State Bank of India (SBI) has revised its External Benchmark Based Lending Rate (EBLR), bringing it down by 25 basis points from 8.65% to 8.40%, effective 15 April 2025. Additionally, SBI has revised its home loan interest rate to 8.25%, enhancing affordability for housing finance seekers.
Bank of India Slashes Loan Rates
Bank of India (BoI) also responded to the rate cut by reducing its home loan interest rate by 25 basis points. The revised rate now stands at 7.90% per annum, subject to the borrower’s CIBIL score.
The bank has extended the benefits of the rate cut across a range of retail loan products. Interest rates have been reduced by 25 basis points for vehicle loans, personal loans, education loans, loans against property, and the Star Reverse Mortgage Loan.
Deposit Rates Realigned
In addition to lending rate changes, banks have realigned their Savings and Fixed Deposit (FD) interest rates, with some banks discontinuing special deposit schemes while others launch new offerings to attract customers.
Positive Outlook for Borrowers
These developments are seen as part of the banking sector’s efforts to boost credit demand, while passing on the benefits of the RBI’s rate cut to consumers. The reduction in borrowing costs is particularly expected to benefit homebuyers, students, and consumers seeking personal and vehicle loans.
