Home Loans Get Cheaper: Indian Overseas Bank Cuts Interest Rates After RBI Decision

EMIs to Reduce as Repo-Linked Lending Rate Drops to 8.85% Indian Overseas Bank Slashes Home Loan Interest Rate by 0.25%

New Delhi, India April 2025: In a major relief for home buyers, Indian Overseas Bank (IOB) has announced a 0.25% reduction in its repo-linked lending rate (RLLR) following the Reserve Bank of India’s (RBI) move to cut the repo rate from 6.25% to 6.00%. With this rate revision, the bank’s home loan interest rate now stands at 8.85%, down from 9.10%. The new rates are effective from April 12, 2025.

This decision is expected to ease the financial burden on borrowers, making home loans, personal loans, and other credit facilities cheaper.

EMI to Drop for New and Existing Borrowers

Customers availing loans from Indian Overseas Bank can now expect lower EMIs, thanks to the reduced interest rates. The latest rate cut directly benefits all loans linked to the repo rate, which includes most retail loans like home loans, car loans, and education loans.

Financial experts suggest that this move will stimulate housing demand, especially among first-time home buyers looking for affordable financing options.

RBI’s Monetary Policy Spurs Lending Rate Cuts

This interest rate reduction by IOB follows the RBI’s Monetary Policy Committee (MPC) decision aimed at taming inflation and supporting economic growth. As part of this effort, the central bank reduced the repo rate to 6.00%, signaling banks to make borrowing cheaper for the public.

While Indian Overseas Bank is among the first public sector banks to react, similar rate cuts from other major banks are expected in the coming weeks.

Summary of New Lending Rates

• Previous RLLR: 9.10%

• New RLLR: 8.85%

• Effective From: April 12, 2025

• Benefit: Lower EMIs on home and retail loans

This change comes at a time when global economic pressures, including trade tensions, have raised uncertainty. The bank’s proactive rate cut aims to maintain domestic economic momentum and boost consumer confidence.