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Repo rate to be external benchmark for floating rate loans from Oct 1: SBI

The bank has also extended the external benchmark-based lending to medium enterprises, to boost lending to the MSME sector as a whole

Press Trust of India  |  Mumbai 

Repo rate to be external benchmark for floating rate loans from Oct 1: SBI

State Bank of India on Monday said it will adopt as the external benchmark for all floating rate loans for MSME, home and retail loans, from October 1, 2019.

On September 4, the Reserve Bank of India (RBI) had mandated all to link all new floating rate personal or retail loans and floating rate loans to micro, small and medium enterprises (MSMEs) to an external benchmark from October 1 onwards.

We have decided to adopt as the external benchmark for all floating rate loans for MSME, housing and retail loans effective October 1, 2019, the bank said in a release.

The RBI gave the options to benchmark their floating rate loans either to repo rate, three-month or six-month treasury bills or any benchmark market interest rate published by Financial Benchmarks India Private (FBIL).

The bank has also extended the external benchmark-based lending to medium enterprises, to boost lending to the sector as a whole.

It had introduced floating rate home loans effective July 1, 2019, but has made some modifications in the scheme effective October 1, 2019, to comply with the latest regulatory guidelines, the release said.

First Published: Mon, September 23 2019. 11:00 IST
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