RBI proposes cap on small loan interest up to ₹50,000
The RBI just proposed a limit on how much banks and lenders can charge for small personal loans (up to ₹50,000).
The goal? To stop borrowers from getting hit with super high interest rates, especially on microfinance loans.
This move could make borrowing a bit safer and more predictable for people who need smaller amounts.
RBI draft mandates lender pricing transparency
Lenders will now need clear, board-approved policies for how they set loan prices, and they'll have to review these rules every year.
For commercial banks and other lenders with over ₹1,000 crore in deposits, loan rates must be based on recent average costs and published monthly.
Plus, floating-rate loans taken by individuals and small businesses will have to link their interest rates to an external benchmark, making things more transparent for everyone.
The RBI released draft guidelines on Wednesday.