FM for lower home loan rates up to Rs 20 lakh

NEW DELHI: There was a public demand for lowering of interest rates on home loans up to Rs 20 lakh, but government told that banks and RBI to take a call. I shall certainly bear in mind that there is a public demand that interest rates for borrowers, who borrow (housing loans) up to Rs 20 lakh, must be slashed. FM, during his post-budget interaction with industry chamber Assocham. The Finance Minister said he agreed that housing loan borrowers of less than Rs 20 lakh should be incentivised by lowering interest rates. "I made a number of efforts to impress upon bankers in this regard ... it is a constant effort that I will have to make... bankers will have to take a call, RBI will have to take a call." As much as 80 per cent of all housing loans fell in the category of below Rs 20 lakh, he said, adding that these loans had less risk weight than those above Rs 20 lakh and, therefore, bankers had incentives to lend to these borrowers at lower interest rates. The RBI governor’s position to strike a balance between low inflation and high growth is unenviable.