Major Indian banks lift repo-linked loan rates, pushing EMIs higher
Punjab National Bank, Bank of India, Indian Bank and Bank of Baroda have raised their repo-linked loan rates, meaning borrowers will face higher EMIs.
Following the Reserve Bank of India's recent repo-rate hike to 5.50%, Punjab National Bank, Bank of India, Indian Bank and Bank of Baroda have each revised their repo-linked loan rates. PNB and Bank of India increased their rates to 8.35% effective October 7-8, 2026; Indian Bank raised its rate to 8.20%; and Bank of Baroda set its BRLLR at 8.15% based on a 2.65% spread. These adjustments will translate into higher equated monthly instalments for borrowers, particularly for home loans.
The RBI's policy change raises banks' borrowing costs, which are passed on to customers. Adhil Shetty, CEO of Bankbazaar, suggests borrowers may face higher EMIs or longer tenures and recommends small annual prepayments to limit extra interest. Additional banks are expected to follow suit in the coming days.
Why it matters
Higher loan rates will increase monthly payments for millions of Indian borrowers.
How this story developed
- Sep 22 How first-time buyers can protect mortgage rates before an offer is accepted
- Oct 6 Nationwide launched a reservation product that can lock a quoted mortgage rate for up to 90 days after a decision in principle.
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