Mumbai:State Bank of India, the country's largest lender, has decided to adopt RBIs repo rate as the external benchmark for all floating rate loans for MSME, home and retail loans from October 1.
The benchmarks to which banks can link the new floating rate retail loans for the purpose of transmission are -- RBI's repo rate, Government of India 3-Months Treasury Bill yield published by the Financial Benchmarks India Private Ltd (FBIL), Government of India 6-Months Treasury Bill yield published by the FBIL or any other benchmark market interest rate published by the FBIL.
Leaving the options to banks, the RBI said banks are free to offer such external benchmark linked loans to other types of borrowers as well.