Chennai: The Reserve Bank of India’s (RBI) Monetary Policy Committee (MPC) has decided to bring greater transparency in resetting the interest rate on equated monthly installments (EMI) for floating interest loans, Governor Shaktikanta Das said Thursday.
Announcing the decisions of the MPC, Das said: “It is proposed to put in place a transparent framework for reset of interest rates on floating interest loans.
“The framework will require Regulated Entities to (i) clearly communicate with borrowers for resetting the tenor and/or EMI; (ii) provide options for switching to fixed-rate loans or foreclosure of loans; (iii) disclose various charges incidental to the exercise of the options; and (iv) ensure proper communication of key information to borrowers.”
These measures will further strengthen consumer protection, he added.
IANS