The benchmark lending rate has been increased by .25 percent, by the kotak Mahindra Bank, on Monday. Auto, home, corporate and other loans have expensive and people may have to repay the revised amount, from 13th of August, 2013. The base rate has been revised from 9.75% to 10%. However, this increase may not affect the loans that are exempted by the Reserve Bank of India.
At the beginning of August 2013, the HDFC Bank had announced the interest rate to 9.8 from 9.6%. Since the INR is very week, commercial banks have no other alternatives, except increasing the rate of interest. In fact, the INR touched the all-time record low of 61.80, which was alarming. The Reserve Bank of India has fixed the lending repo rate, as 7.25%. On 15th of July, 2013, the RBI has increased the interest rate to 10.25%, including the Marginal Standing Facility, with the aim of restoring the stability of Indian Rupee.