RBI MPC cuts repo rate. What does it mean for your home, car loan EMIs?

New Reserve Bank of India or RBI governor Sanjay Malhotra on Friday, February 7, announced that the Monetary Policy Committee (MPC) has decided to cut the benchmark repo rate by 25 basis points to 6.25%. This rate cut, the first time in nearly five years after it remained unchanged for 11 consecutive policy meetings, is expected to lower the interest rates on loans, especially benefiting homebuyers and other types of borrowers as well.

“The rate cut is expected to translate into lower equated monthly instalments (EMIs) for home loans, auto loans, and personal loans, making credit more affordable for consumers," a News18 report quoted Adhil Shetty, CEO of Bankbazaar.com, as saying. "Banks and financial institutions are likely to pass on the benefits by reducing their lending rates, which could ease financial pressures for both existing and new borrowers,” Adhil Shetty said.