SBI to link all new floating loans to repo

Mumbai: The country’s largest lender State Bank of India (SBI) will use the repo rate as the external benchmark to price all new floating rate loans for Micro, Small & Medium Enterprises (MSMEs), housing and retail loans effective October 1 in line with the central bank’s notification. The bank will also voluntarily extend benchmark-based lending to medium enterprises to boost lending to the MSME sector as a whole.

SBI had introduced floating rate home loans effective July 1, 2019 but had later withdrawn it. “A few modifications have been made in the scheme effective October 1, 2019 to comply with the latest regulatory guidelines,” the bank said.

Effective September 1, 2019, the SBI Repo Linked Lending Rate (RLLR) is 7.65 per cent. The effective RLLR linked home loan, however, will depend on the loan amount, loan-to-value of the loan and the risk group of the borrower.