RBI Cuts Repo Rate to 6% | Cheaper Home & Personal Loans Ahead
Pune, April 10, 2025 – In a significant boost for borrowers and the economy, the Reserve Bank of India (RBI) has announced a repo rate cut, lowering it from 6.25% to 6%. This marks the first rate reduction since November 2022, and is expected to ease borrowing costs across the board—from home loans and personal loans to business credit lines.
What Is the Repo Rate?
The repo rate is the interest rate at which the RBI lends money to commercial banks. When the repo rate drops, borrowing becomes cheaper for banks—who then pass on the benefits to consumers in the form of lower interest rates.
Why the Rate Cut Now?
The decision arrives at a crucial juncture for India’s economy, which is facing external pressures, including increased US import duties. Lowering the repo rate is intended to:
- Boost credit flow to businesses and consumers
- Stimulate economic activity
- Enhance consumer demand
- Encourage investment and employment growth
What It Means for You
- Home Loans: Likely to become more affordable, lowering EMIs
- Personal Loans & Credit Cards: Interest rates may drop
- Businesses: Easier and cheaper access to working capital and expansion funds
- Job Creation: Increased investments could lead to more employment opportunities
Governor’s Statement
Announcing the first monetary policy review of FY 2025–26, RBI Governor Sanjay Malhotra said:
“This rate cut is aimed at supporting economic growth amid global uncertainties. Increased credit availability will encourage spending and investment, ultimately leading to employment generation.”
Past Trends & Future Outlook
- This is the second consecutive rate cut, following a similar move in February 2025.
- Economists predict further cuts could follow if inflation remains under control, offering continued relief to borrowers.
With this move, the RBI has clearly signaled its intention to reignite economic momentum, making credit more accessible and affordable for individuals and businesses a like.
