New Delhi— Just hours after the Reserve Bank of India (RBI) announced a 25 basis point cut in the repo rate, two major public sector banks — Bank of India and UCO Bank — on Wednesday reduced their lending rates, offering relief to both existing and new borrowers.
The RBI’s Monetary Policy Committee (MPC), led by Governor Sanjay Malhotra, lowered the key policy rate from 6.25% to 6.00% earlier in the day.
This marks the second consecutive rate cut under Malhotra’s leadership, aimed at bolstering economic growth amid mounting global challenges, including a steep 26% tariff imposed by the United States on Indian exports.
Responding promptly to the central bank’s decision, Bank of India reduced its Repo-Based Lending Rate (RBLR) to 8.85%, down from 9.10%. The revised rate took effect immediately on April 9.
Similarly, UCO Bank announced a reduction in its repo-linked lending rate to 8.80%, with the new rate becoming effective on Thursday.
Both banks disclosed the rate cuts through separate regulatory filings, attributing the revisions to the RBI’s latest policy announcement.
The rate cuts are expected to make loans more affordable, encouraging increased borrowing by both individuals and businesses. Financial experts anticipate that other banks will soon follow suit, passing on the benefits of the rate cut to customers across the country.
While announcing the policy decision, Governor Malhotra also revealed a shift in the RBI’s policy stance from “neutral” to “accommodative,” signaling the central bank’s readiness to support growth through a more relaxed monetary policy approach.
“Our stance provides policy rate guidance without offering any direct indication on liquidity management,” Malhotra said.
Over the past two months, the RBI has infused more than $80 billion into the banking system. This follows a previous rate cut in February — the first such move in five years. (Source: IANS)
