New Delhi: The Reserve Bank of India has hiked the repo rate by 0.25 percent, taking it from 6.25 percent to 6.50 percent, meaning everything from home loans to auto and personal loans will become more expensive and you will have to pay more EMIs. . This is the first MPC meeting since Finance Minister Nirmala Sitharaman presented the budget on February 1. Suppose a person has taken a loan of 30 lakhs at a fixed rate of 7.90% for 20 years. Its EMI is 24,907. is In 20 years he will have to pay interest of Rs 29.77 lakh at this rate. That means he will have to pay a total of ₹ 59.77 lakh instead of ₹ 30 lakh. RBI increased repo rate by 0.25 percent after taking loan, due to which banks also increase interest rate by 0.25 percent. Now when another person approaches the same bank for a loan, the bank tells him 8.15 percent interest instead of 7.90 percent. The first person takes a loan of ₹ 30 lakh for 20 years, but his EMI becomes ₹ 25,374. That is 467 ₹ more than EMI. Due to this, the other person will have to pay a total of 60.90 lakh rupees in 20 years. 1.13 lakhs more than a single person. RBI has a powerful tool to fight inflation in the form of repo rate. When inflation is too high, the RBI tries to reduce the flow of money into the economy by raising the repo rate. If the repo rate remains high, the loans that banks will get from RBI will be expensive. In turn, banks will make loans more expensive for their customers. This will reduce the flow of money in the economy.
