PNB Cuts Home Loan: Just after the Reserve Bank of India (RBI) announced a cut in policy rates, the leading public sector bank, Punjab National Bank (PNB), on Friday announced a significant 0.50 percent cut in interest rates. After this auspicious announcement, now taking all types of loans including car loans, home loans, and personal loans from PNB will become much cheaper.
Also, the EMI (monthly installment) of the existing customers of the bank will be reduced, which will reduce the financial burden on them. After this announcement, with the reduction in the benchmark repo-linked benchmark lending rates (RBLR), the bank’s home loan will now start from 7.45 percent, while vehicle loans will start from 7.8 percent per annum. This news has brought a wave of joy to millions of customers.
Customers will get great relief
This move by PNB will provide tremendous help to both existing and new borrowers. It is expected that other banks will also make similar announcements soon, making loans cheaper across the banking sector. PNB said in a post on X (formerly Twitter), “Good news for our valuable customers! Punjab National Bank has made your EMI even more affordable! Following the repo rate cut (6.00% – 5.50%), Punjab National Bank has reduced its RLLR by 50 basis points, effective from June 9, 2025.”
RBI cuts repo rate to 5.5 percent
Earlier in the day, the Reserve Bank of India cut interest rates by 50 basis points and also unexpectedly reduced the Cash Reserve Ratio (CRR) to make more money available to banks for lending to boost the economy. The six-member Monetary Policy Committee headed by RBI Governor Sanjay Malhotra voted five-to-one in favour of reducing the benchmark repo or repo rate by 50 basis points to 5.5 percent. This shows that the main objective of the RBI is to accelerate economic growth in the country.
CRR also cut by a huge 1 percent
The RBI also cut the cash reserve ratio (CRR) by 100 basis points to 3 percent, adding another ₹2.5 lakh crore to the already existing surplus liquidity in the banking system. This move will encourage banks to lend more money to customers, increasing the flow of money in the market and boosting economic activity.
With the June 6 cut, the RBI has cut interest rates by a total of 100 basis points so far in 2025, starting with a quarter-point reduction in February (the first cut since May 2020) and a similar cut in April. These consecutive cuts indicate that the central bank is committed to getting the economy back on track and boosting investment.