9th April 2020: Most of the public sector banks have passed on the benefit of the repo rate cut to their customers. Punjab National Bank (PNB) and Indian Overseas Bank on 31st March announced a reduction in their lending rates linked to the repo rate by 75 basis points, effective April 1. This follows last week’s decision by the RBI to cut the repo rate by 75 bps.
The cut is for retail and MSME borrowers. These Banks have decided to pass on the full benefit of the recent RBI’s policy rate cut of 75 bps to their borrowers covered under the external benchmark-linked product of repo-linked lending rate (RLLR). The new RLLR will come down from the existing level of 8 percent to 7.25 percent per annum from April 1. Retail loans (housing, education, vehicle), loans to MSME, which are linked to RLLR, will now be available at cheaper rates.
PNB has further reduced its term deposit rates in various maturities bucket with a maximum rate of 5.80 percent for deposits maturing in one year and above.