AMN / MUMBAI
After several public sector banks, including State Bank of India, have voluntarily linked their loans and deposits pricing to the repo rate.
Reserve Bank Governor Shaktikanta Das today stressed on the need for the entire system switching to this model.
Speaking at an annual banking conference organized by the industry lobby FICCI in Mumbai, the RBI Governor said such a move can speed up the monetary transmission process.
While the SBI was to first one to link its loans and deposits to the repo rate from May and home loans from July. Six other peer banks like Bank of Baroda, Union Bank and Canara Bank among others also announced the same last week.
Earlier this month, in last monetary policy, RBI lowered the repo rates by 35 basis points to a nine-year low of 5.4 percent.