The Reserve Bank of India (RBI) on Friday decided to keep the repo rate unchanged at 6.5 percent in its fourth bi-monthly monetary policy committee (MPC) meeting.
This is seen as a breather for home loan borrowers who don’t have to battle with higher home loan interest rates, at least in the immediate future.
The lowest home loan interest rates currently hover around 8.75 percent to 9 percent at most top lenders, higher than the lowest rates of 6.75 - 7 percent that prevailed until early 2022 before the spate of repo rate hikes that cumulatively pushed them upward by 250 basis points.
The announcement made by RBI Governor Shaktikanta Das of keeping the repo rate unchanged is in line with the industry expectations that were hoping for the central bank to maintain the status quo.
“With no changes in Repo rate & CRR, we expect the lending portfolios to go this quarter as festive season is round the corner. Segments like Consumer Durable Loans, Car Loans, Personal Loans & Fresh Home Loans are expected to do well in this quarter. We foresee the rates to remain unchanged the next quarter as well,” says Himanshu Panchmatiya, Cofounder Switch My Loan.
PIDF scope widened
The RBI governor also announced to include Pradhan Mantri Vishwakarma Scheme beneficiaries to the Payments Infrastructure Development Fund (PIDF). “Since Jan 2021 when PIDF was launched, it has enabled 2.66 crore new payment touchpoints across the country. The scheme has now been extended by another two years till Dec 31, 2025 and will also include beneficiaries of PM Vishvakarma Scheme and will also deploy emerging modes of payment acceptance such as sound box and Aadhaar-enabled biometric acceptance devices,” said Das while addressing the media.
Card on file (COF) tokenisation
The RBI governor Shaktikanta Das also announced to introduce card-on-file tokenisation directly at the issue bank level that, he says, will enhance convenience to get tokens created and linked to the e-commerce applications.
Special campaign
It is interesting to note that State Bank of India is currently running a special campaign to offer home loans at concessional interest rates. The four-month campaign would end in December.
The new rates range between 8.6 to 9.65 percent against the earlier ones of 9.15 to 9.65 percent. Higher the credit score of a customer, lower is the interest rate offered.
