Punjab National Bank, Canara Bank, ICICI Bank and Bank of Baroda have increased loan interest rates so far this month, reflecting the impact of the RBI hike in the repo rate. More banks may do the same in the coming days.
New Delhi. ICICI Bank, PNB, Bank of Baroda, Canara Bank have increased their interest rates after RBI’s Monetary Policy Committee (MPC) hiked the repo rate by 50 basis points (bps) to control inflation. After the increase in the repo rate, banks are increasing the interest rates on both deposits and loans.
It is possible that in the coming week, we will get to see such increase from other banks as well. Let us tell you that on August 5, the Monetary Policy Committee of RBI had increased the repo rate to 5.40 percent. Banks will now pass its direct effect to the customers. Let us see how much these four banks have increased the interest rates.
Bank of Baroda- Retail loan will now have an interest rate of 7.95 percent. Which is 2.55 percent more than the repo rate. The retail loans of the bank are operated on the basis of repo rate.
ICICI Bank – Its External Benchmark Lending Rate (I-EBLR) is linked to the RBI’s repo rate. I-EBLR has been reduced to 9.10 per cent per annum with effect from August 5.
Canara Bank – Repo rate-linked lending rate has been increased by 50 bps to 8.30 per cent. The new rate has come into effect from today i.e. August 7.
Punjab National Bank- Repo linked lending rate has also been increased from 7.40 per cent to 7.90 per cent. The new rates will be effective from 8 August 2022.
- Bank of Baroda- Retail loan will now have an interest rate of 7.95 percent. Which is 2.55 percent more than the repo rate. The retail loans of the bank are operated on the basis of repo rate.
- ICICI Bank – Its External Benchmark Lending Rate (I-EBLR) is linked to the RBI’s repo rate. I-EBLR has been reduced to 9.10 per cent per annum with effect from August 5.
- Canara Bank – Repo rate-linked lending rate has been increased by 50 bps to 8.30 per cent. The new rate has come into effect from today i.e. August 7.
- Punjab National Bank- Repo linked lending rate has also been increased from 7.40 per cent to 7.90 per cent. The new rates will be effective from 8 August 2022.
Repo rate increased 3 times in 4 months
The RBI has once again increased the repo rate by 50 basis points in August after a total increase of 90 basis points in May and June. RBI has increased the interest rate of loans given to banks by 1.40 percent for 3 months. According to experts, it is expected to be extended further. Yes Bank Chief Economist Indranil Pan has said that the RBI will take the repo rate to 6 percent by December.
RBI on inflation
RBI Governor Shaktikanta Das has said that inflation is dependent on commodity prices, southwest monsoon, global geopolitical conditions and financial markets. He said that there has been some reduction in global commodity prices and apart from edible oils, some have become cheaper. He said that there has also been a relief from the restoration of wheat supply in the Black Sea and if it continues like this, then it will be of some help in bringing down inflation. He said that retail inflation is expected to come down to 6 per cent in the last quarter of the ongoing financial year.
