The country’s largest lender, State Bank of India (SBI) has relaunched its repo-linked home, automobile, MSME loans to comply with regulatory norms that kick in from October 1.
The bank said it will link its retail and SME loans to Reserve Bank of India’s (RBI) repo rate as external benchmark. The lender has also voluntarily extended the benchmark to micro and small enterprises from October 1.
As per RBI norms, banks have to link their retail and SME loans to an external benchmark starting next month. Other than the repo rate, other options include the three-month or six-month treasury bill yield published by Financial Benchmarks India Pvt (FBIL).
In May, SBI had introduced these products voluntarily but withdrew them from the market after RBI issued a circular making it mandatory for all banks to follow suit.
SBI said it has modified its home, auto and SME floating rate products to comply with regulatory norms. The changes will be released on its website soon, SBI said.
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