PNB loan rate cut: State-owned Punjab National Bank (PNB) has said it lowered its Repo Linked Lending Rate (RLLR), a day after the Reserve Bank of India (RBI) cut the repo rates by 25 basis points.
In a stock exchange filing on Saturday, December 6, PNB informed that it was revising its RLLR effective immediately. PNB RLLR was cut down from 8.35% to 8.10%, including a BSP of 10 basis points, it said.
However, the Marginal Cost of Lending Rate (MCLR) and Base Rate of PNB remain unchanged.
The PNB rate cut came a day after the RBI cut its repo rates by 25 basis points during its bimonthly MPC meeting on Friday.
The six-member monetary policy committee, led by RBI Governor Sanjay Malhotra, voted unanimously to lower the repurchase or repo rate by 25 basis points to 5.25% and retained a neutral stance, which give room for further rate cuts.
This is the fourth rate cut by the central bank since February 2025. It held rates in August and October bimonthly monetary policy meetings.
What did the PNB notification say?
“The Exchange is hereby informed that consequent upon the decrease in the Repo rate by the RBI on 05.12.2025, the Bank has revised the Repo Linked Lending Rate (RLLR) from 8.35% (including BSP of 10 bps) to 8.10% (including BSP of 10 bps) with effect from 06.12.2025,” PNB said in its notification.
What does PNB RLLR rate cut mean?
The PNB RLLR rate cut by 25 bps means that your home loan interest rate will go down, if it is linked to the RBI repo rates. This means you will have to pay lower EMIs on your home loans. The reset period for RLLR is usually three months. This means that if your EMI started in October, the effective home loan rate cut will be done in January.
PNB's action follows similar measures taken by other banks including Bank of India and Indian Bank, who announced new home loan interest rates.
The Indian Bank cut its repo-linked benchmark lending rate from 8.20% to 7.95%, a reduction of 25 bps.
What is RRLR?
All banks offer home loans at a certain rate of interest, which can be fixed or floating. If this interest rate is linked to the RBI repo rate, it is called repo linked lending rate (RLLR). As per an October 2019 circular from RBI, banks must link their retail loans to external benchmark lending rates (E-BLR). As a result, most banks have adopted the repo rate as their benchmark.
