Indian Overseas Bank cuts repo-linked lending rate by 25 bps

Indian Overseas Bank (IOB), a public sector bank headquartered in Chennai, has announced a reduction in its Repo Linked Lending Rate (RLLR) by 25 basis points. This decision comes in response to the Reserve Bank of India’s (RBI) recent move to lower the policy repo rate from 6.25% to 6.00% during its latest Monetary Policy Committee (MPC) meeting. The reduction in the repo rate is aimed at boosting economic activity and addressing uncertainties in the financial landscape.

Following the RBI’s decision, IOB’s Asset Liability Management Committee convened on April 11, 2025, to pass on the benefits of the rate cut to its customers. As a result, the bank has reduced its RLLR from 9.10% to 8.85%, effective April 12, 2025. This reduction is expected to make borrowing more affordable for customers, particularly for loans linked to the repo rate, such as home loans and personal loans.

The move aligns with the broader trend among Indian banks to adjust lending rates in response to changes in the RBI’s monetary policy. It reflects the bank’s commitment to supporting its customers and contributing to economic growth by ensuring access to credit at competitive rates.

This development is significant for borrowers, as it directly impacts the cost of loans and can lead to savings on interest payments. It also highlights the dynamic relationship between the RBI’s monetary policy decisions and the banking sector’s lending practices.