August 19, 2023 1:28 PM

RBI asks banks to provide individual borrowers option to switch over to fixed rates at time of reset of interest rates

Reserve Bank of India, RBI, yesterday asked banks to provide fixed interest rate options to individual borrowers and directed the lenders to levy only reasonable penalty charges in case of default in EMI payments. The two decisions are expected to provide relief to the borrowers amid rising interest rates and most of the retail loans being on floating rates now. RBI has issued guidelines to reset EMIs based on floating-rate personal loans, including allowing borrowers to switch over to a fixed r...