Now Reading: RBI retains external benchmark for retail, MSME loans
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RBI retains external benchmark for retail, MSME loans
The Reserve Bank of India has retained external benchmark linkage for floating-rate personal and MSME loans, NDTV Profit reports. For banks and NBFCs, the central bank has proposed standardising the MCLR calculation…
The Story in Brief
The Reserve Bank of India has retained external benchmark linkage for floating-rate personal and MSME loans, NDTV Profit reports. For banks and NBFCs, the central bank has proposed standardising the MCLR calculation based on a three-month average cost of fresh deposits. The move aims to improve transmission of policy rate changes without overhauling the current system.
The Indian Opinion
Some analysts had expected the RBI to tighten external benchmark rules or scrap MCLR entirely. Instead, the central bank kept the framework largely unchanged. The real test will be whether banks pass on rate cuts faster under the proposed standardised MCLR. That depends on the final circular's details.
Source: ndtvprofit.com
This story was synthesised by AI from the source linked above.
