Punjab National Bank has increased the interest rates on fixed deposits by up to 60 basis points in select schemes. This decision will come into effect from May 7. Along with this, the bank has increased the repo-linked lending rate (RLLR) for existing customers from 6.5% to 6.9% with effect from June 1.
The RLLR hike comes after the Reserve Bank of India announced a surprise hike of 40 basis points in key policy rates. Besides this, the cash reserve ratio (CRR) has also been increased by 50 basis points.
Apart from PNB, ICCI Bank and Bank of Baroda have also linked external benchmark linked loan interest rates. The external benchmark lending rate moves up or down according to the fluctuations in the repo rate. The increase in repo by RBI will increase the cost of most personal loans, auto and home loans for customers as new loans after October 2019 are linked to the repo rate.
Punjab National Bank: RRRLR hiked for existing customers, hike in interest rates on fixed deposits