Public sector Punjab National Bank (PNB) has also increased the interest rate. PNB has increased the interest rate (external benchmark lending rate) linked to the repo rate by 0.40 percent. With this increase, taking all types of loans including home, auto and personal loans from PNB has now become costlier.
Punjab National Bank said in the information given to the stock exchange that the repo based interest rate (RLLR) has been increased by 0.40 percent. After this hike, the bank's RLLR has increased from 6.50 per cent to 6.90 per cent. The revised RLLR for new customers of PNB has come into effect from May 7, 2022, while for existing customers it will be effective from June 1, 2022.
It is noteworthy that with effect from October 1, 2019, RBI had made it mandatory to link all personal and retail loans with floating rate to an external benchmark. This is the reason why ICICI Bank, Bank of Baroda and Bank of India also increased the repo based interest rate after the Reserve Bank hiked the repo rate.