Home loan borrowers would have to wait a little longer as the banks are not likely to pass the benefits of RBI's repo rate cut to borrowers this month.
Mr. S S Mudra, Chairman and Managing Director of Bank of Baroda said, "There is no reason to believe that easing will happen at a measured pace. We expect easing of deposit rates as we enter new fiscal year, and this happens, the transmission will take place".
However, borrowers need not be gloomy as there is rate cut in the offing, if not immediate. They can expect rate cut in the coming weeks. Mr. B A Prabhakar, Chairman and Managing Director of Andhra Bank said, "Since the deposit growth has been muted, interest rates on deposits too have remained high. Therefore, we expect the monetary transmission to take place only after two to three months".
And when the bank reduces the rates, the EMIs or the loan tenure would be shortened. The shortening of the loan tenure would mean lower interest burden on loans.