Chennai based Public Sector Bank Indian Overseas Bank (IOB), has linked Repo Linked Lending Rate (RLLR) to its loans to be sanctioned under Retail segment (Housing, Vehicle, Education and Clean loans) and Micro & Small Enterprises with effect from 1st October 2019.
Henceforth, all the new loans under the said categories will be priced based on RLLR only. The new benchmark (RLLR) is fixed at Repo rate +2.85 % (8.25% at present).
Under this new bench mark, Housing Loans will be available at Cheaper Interest rates. In addition to Housing Loans, other Retail Loans like Vehicle, Education and Clean Loans as well as Micro and Small Enterprise Loans will also be available at cheaper interest rates.
As a gesture to small borrowers, the Bank has decided to charge Mudra loans up to Rs. 50,000/- at an interest rate of 8.25% p.a. passing a benefit of 0.25% to these borrowers.
Further, Bank announced its decision to link interest rate on Savings Accounts (with balance of Rs.25 Lac and above) However, interest rate to be paid for such Savings Accounts is presently pegged at 4% level offered by the Bank.