and Industry, Coimbatore
Press Release
June 30, 2010: Switch Over to Base Rate by Banks
The Indian Chamber of Commerce and Industry, Coimbatore welcomes the RBI’s instructions to move to base rates from 1st July based on which most of the banks including State Bank of India have announced base rate between 7.5 and 8 percent. This base bank rate implementation in place of the Benchmark Prime Lending Rate (BPLR) hitherto in practice, will largely benefit MSMEs though it may be costlier for highly rated companies.
Large corporates will be able to raise funds through short term sources, as banks will not be allowed to lend below the base rate.
However, it is good news for small and medium companies (MSMEs) as they would be able to get a good interest rate, if not immediately, but in the near future.
Our Chamber has been pleading for implementation of Base Rate, to reduce cost of funds and also to bring in transparency in the lending rates. We thank the RBI and the Government and the Banks for moving towards the base rate system.
Mahendra Ramdas
President