RBI makes fresh bid to boost transmission mechanism

reserve-bank-of-india-sign

The Reserve Bank of India has made a fresh attempt to deal with the long-running problem of the pass-through of policy rates to the real economy, by mandating banks to link floating-rate loans to an “external benchmark”.

“It has been observed that due to various reasons, the transmission of policy rate changes to the lending rate of banks under the current MCLR [marginal cost of fund-based lending rate] framework has not been satisfactory,” the RBI said in a statement on September 4.

The

Only users who have a paid subscription or are part of a corporate subscription are able to print or copy content.

To access these options, along with all other subscription benefits, please contact [email protected] or view our subscription options here: http://subscriptions.centralbanking.com/subscribe

You are currently unable to copy this content. Please contact [email protected] to find out more.

To continue reading...

You need to sign in to use this feature. If you don’t have a Central Banking account, please register for a trial.

Sign in
You are currently on corporate access.

To use this feature you will need an individual account. If you have one already please sign in.

Sign in.

Alternatively you can request an individual account here: