What is Base Rate ? Define Base Rate. Meaning of Base Rate ? Which categories of loans are exempted from Base Rate ? The Base Rate is the minimum interest rate of a Bank below which it cannot lend, except in cases allowed by RBI. The Base Rate system has replaced the BPLR system with effect from July 1, 2010. Base Rate shall include all those elements of the lending rates that are common across all categories of borrowers. Banks may choose any benchmark to arrive at the Base Rate for a specific tenor that may be disclosed transparently. There can be only one Base Rate for each bank. However, banks have the freedom to choose any benchmark to arrive at a single Base Rate but the same needs to disclosed transparently.
Posted on: Tue, 17 Sep 2013 17:49:22 +0000
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