Better transmission, but more volatility for borrowers: Experts

From a borrower's perspective, shopping for a loan, currently, can be seriously confusing

The Reserve Bank of India’s unhappiness with slow transmission of its repo rate cuts could soon lead to a new external benchmark rate – the Treasury bill rate, certificate of deposit rate or the apex bank’s repo rate. The apex bank’s Internal Study Group has proposed that one of these three external benchmarks should be implemented from April 1, 2018, and all lending rates should be linked to it, and even bulk deposit rates.

But some industry experts believe that the move isn’t necessary. Says Keki Mistry, vice-chairman and chief executive officer, HDFC: “I believe that an external benchmark isn’t