RBI Hikes Repo 0.25%: Will Your EMI Rise?

RBI raised the repo rate by 0.25% to control inflation. This means banks will likely charge more interest on home, car, and personal loans — your EMI could go up within weeks.

Here's what happened: RBI's Monetary Policy Committee raised the repo rate by 25 basis points on 7 October, its latest move to cool persistent inflation.. The repo rate is the benchmark at which RBI lends to banks — a hike typically pushes up interest rates on all floating-rate retail loans.. Both borrowing costs (EMIs) and deposit returns (FD rates) are expected to adjust upward as banks reprice their products..

What you should do: Check your loan statement or bank app today to confirm whether your loan is on a floating rate — if yes, expect an EMI revision within 1–2 billing cycles.. Call or email your lender to ask for a revised repayment schedule reflecting the new rate, so you are not caught off guard by a higher debit.. Compare current FD rates across banks and small finance banks — this hike is a good trigger to lock in a slightly higher rate on any idle savings..

On a floating home loan, ask your lender to extend your loan tenure instead of raising your EMI — same rate, same monthly outflow, less immediate cash-flow pain.