The Reserve Bank of India cut its key repo rate – the rate at which the RBI lends shot-term money to banks against securities – by 0.25 per cent on Friday, the third time since January, but the central bank's decision is unlikely to provide any respite to consumers reeling under the burden of high equated monthly installments (EMIs). Interest rates on fresh retail loans are also unlikely to come down.
Diwakar Gupta, MD and CFO of State Bank of India, told NDTV that a repo rate cut does not translate into any difference in the bank's earnings and revenues, so it's hard to cut retail loan rates on the basis of a repo rate cut. State Bank of India is the country's largest lender.
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