New Delhi: RBI Governor Shaktikanta Das announced cut in repo rate to 4 per cent from the existing 4.4 per cent to boost economy.
This is second cut in the repo rate. Business analysts said this move will allow banks more room to lower the EMI burden for their borrowers.
Das on Friday also extended the loan moratorium by another three months till August. The coronavirus pandemic has pushed the economy into a standstill. The borrowers have an option to extend the repayment of their loan by another three months.
The Equated monthly installments (EMIs) on home and auto loans linked to repo rate is expected to fall due to reduction of the repo rate.
Reports said if one borrows Rs 30 lakh home loan for 30 years from SBI then one’s loan EMI is likely to be reduced by Rs 812.
These measures are expected to significantly reduce the financial strain on borrowers.