Click to play videoNew Delhi: As a part of the Government’ economic booster package, the RBI cut repo rates and reverse repo rates by 100 bps on Saturday, sending a strong signal to banks to cut rates and stimulate growth.
“Credit demand has been slackened. Banks will be urged to cut lending rates, which will come though reduction in deposit rates,” RBI Governor D Subbarao said.
Priority will be given to loans under Rs 20 lakh. This suggests most rate cuts will be in this category. ICICI Bank pre-empted the RBI announcement, cutting interest rates by 1.5 per cent for loans under 20 lakhs.
Others, however, are more cautious.
“This is not enough. We are looking at other measures,” Deputy MD, ICICI Bank, Chanda Kochar says.
So while EMIs may not come down immediately, they will do so over the next few months.
The stimulus package expected from the government could make this easier.
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