RBI mandates banks to link fresh retail loans to external benchmark
RBI mandates banks to link fresh retail loans to external benchmark Move to cover fresh retail, MSME loans from Oct 1; home, auto loans to get cheaper Current Affairs :- The Reserve Bank of India (RBI) on Wednesday made it obligatory for banks to connect all their new retail advances to an outer benchmark, powerful October 1 — the national bank’s repo rate being one such benchmark. All open area banks have moved to such a system deliberately, while private banks are yet to. The state-run banks have presented repo-connected items for skimming rate home and vehicle advances, however the RBI said credits to miniaturized scale, little and medium undertakings (MSMEs) ought to likewise be connected to an outer benchmark. The three outside benchmarks the RBI proposed are arrangement repo rate, the Government of India’s three-month and half year treasury bill yields distributed by Financial Benchmarks India Private (FBIL), or some other benchmark market loan fee distributed by F...