 "Banks, RBI")
Commercial banks are set to increase interest rates on unsecured loans and also for non-banking financial companies (NBFCs) after the Reserve Bank of India (RBI) on Thursday increased risk weighting for such loans.
Due to rates hardening, loan demand for such products will be affected, bankers said.
“Interest rates on unsecured products will go up. We will observe and take a call by Monday or Tuesday,” said Sumit Bali, group executive and head of retail lending, Axis Bank.
On Thursday, the RBI increased risk weighting for unsecured loans like personal loans and consumer durables from 100 per cent to 125 per cent.
Risk weighting
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