Repo Rate Hits 5.5%: Your EMI Rises Now

RBI's rate-setting panel raised the repo rate by 25 basis points to 5.5% and shifted stance to calibrated tightening. If your home, car, or personal loan is on a floating rate, your EMI is going up — here's what to do.

Here's what happened: RBI's Monetary Policy Committee raised the repo rate by 25 basis points to 5.5%, making borrowing more expensive for banks and, in turn, for loan customers.. The MPC also shifted its policy stance to 'calibrated tightening', signalling that further rate hikes are possible but will be gradual and data-dependent.. All floating-rate retail loans — home, car, and personal loans — linked to external benchmarks like RLLR or EBLR will reprice upward within one to three monthly reset cycles..

What you should do: Log in to your bank's loan account portal today and check whether your EMI has increased or your loan tenure has been quietly extended — both are common bank responses to a rate hike.. Compare your current home loan rate against offers from other lenders; if the gap is 50 bps or more, calculate balance-transfer savings using GoCredit's EMI calculator before your next reset date.. Make a lump-sum prepayment — even ₹15,000–₹25,000 — immediately, because prepaying principal NOW reduces the base on which the higher rate compounds going forward..

Ask your bank to keep your EMI the same and reduce tenure instead of raising EMI — this cuts total interest paid and is your legal right on most floating-rate home loans.