Following repo cut, PSBs reduce rates more than private counterparts

The Reserve Bank of India has already cut its key repo rate by 100 basis points in an effort to jumpstart growth in the economy

Following the 100 basis point (bps) cut in the policy repo rate since February this year, India’s public-sector banks have lowered their lending and deposit rates more than their private-sector counterparts, data released by the Reserve Bank of India.

 

The decline in the weighted average lending rates of fresh rupee loans by the public sector banks was 31 bps till May, while that for private banks was 20 bps.

 

Foreign banks saw a sharper decline of 49 bps. For fresh deposits, the interest rates offered by PSBs fell 47 bps as compared to 41 bps by private banks.