Corporates Force Banks To Bid For Loans

Good-bye relationship banking! Top-notch corporates and even mid-cap borrowers are no longer moving banks to raise loans. Instead, they are asking them to put in bids, quoting the lowest interest rates that they can offer. In a way, it is a sort of auctioning of loans by the fund-flush banks.

Hitherto, only blue-chip corporates like Indian Oil Corporation, Reliance and Hindustan Lever Ltd among others, used to command this kind of clout but now even mid-size corporates have started flexing their muscles, said a senior official of a public sector bank.

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