IDBI Bank Repo-Linked Retail Loans Effective From October 1

State-run IDBI Bank on Monday said the introduction of repo-linked retail loans would be effective from October 1.

IDBI Bank had earlier said that it would introduce repo rate-linked home and auto loans with effect from September 10.

However, in view of the RBI directive last week, to link all new floating rate retail loans (personal segments) to external benchmark with effect from October 1, the introduction had been deferred, it said.

"IDBI Bank on August 30, 2019 had announced that it would introduce repo rate-linked home and auto loan with effect from September 10, 2019. However, in view of RBI directive issued on September 4, 2019, to link all new floating rate retail loans (personal segments) to external benchmark with effect from October 1, 2019, the introduction of repo-linked home loan and auto loan has been deferred," it said in a statement.

On September 4, RBI mandated banks to link fresh retail loans to external benchmark. The move is aimed at including fresh retail and MSME loans from October 1 where home, and auto loans will get cheaper.

RBI's repo rate is one such external benchmark.