RBI Governor Shaktikanta Das Repo Rate: Reserve Bank of India Governor Shaktikanta Das on Wednesday announced to increase the repo rate. Repo rate has been increased by 0.40% by RBI. With this, the repo rate increased from 4 percent to 4.40%. Earlier, RBI last changed the repo rate on 22 May 2020.
Loan EMI will increase
RBI’s change in the repo rate has cleared the way for banks to increase the interest rate on loans. With the increase in the repo rate, your home loan, car loan EMI will increase in the coming days. Earlier, in the first monetary review meeting (MPC) of the current financial year, the repo rate was not changed for the 11th consecutive time by the RBI.
Selling phase in the stock market too
The RBI Governor said in his address, the situation of the global economy is deteriorating. Inflationary pressure on the economy continues. The ever-increasing inflation is worrying. Inflation and growth forecast have changed because of the war. After increasing the repo rate by the RBI, the selling in the stock market has also increased.
What will be the effect?
The effect of increasing the repo rate will be on your home loan, car loan or any other loan. If you already have a loan going on or you are about to take a loan, then due to the increase in the interest rate from the bank in the coming days, the EMI will be higher than before. This will affect both new and old customers. Let us understand this in figures. The burden of Rs 8712 will increase annually
If a customer has taken a home loan for 20 years and till now his interest rate was 7 percent, then now it is likely to increase to 7.40 percent. In such a situation, for a period of 20 years on a loan of 30 lakhs, the EMI is Rs 23,259 per month. But now if the interest rate increases by 0.40 percent, this EMI will increase to Rs 23,985. That is, every month Rs 726 more will have to be paid. According to this, about 8712 rupees will have to be paid every year.
What is repo rate?
The rate at which loans are given by RBI to banks is called repo rate. The increase in the repo rate means that banks will get loans from RBI at a higher rate. This will increase the interest rate on home loan, car loan and personal loan etc., which will have a direct impact on your EMI.