3 Point Analysis | RBI’s external benchmark for loans

In a big push to make the transmission of monetary policy more effective, the Reserve Bank of India (RBI) has made it mandatory for banks to link all new floating home and MSME loans to external interest rate benchmarks from October 1st, 2019.

The interest rate under external benchmark will be reset at least once in three months.

Sakshi Batra does a 3-Point Analysis to decode the implications.