Government Bank Slashes Loan Interest Rates, Eases Borrowing for Consumers

New Delhi (The Uttam Hindu): Canara Bank, a leading public sector bank, has announced a big cut of 0.50 percent in the interest rates on repo rate linked loans. After this cut, the revised repo based interest rate has come down from 8.75 percent to 8.25 percent. These new rates have become effective from June 12, 2025.

This move by Canara Bank comes after the Reserve Bank of India (RBI) cut the key policy rate repo by 0.5 per cent last week. With this cut, Canara Bank is passing on the full benefit of the 0.50 per cent reduction in interest rate made by the RBI to its customers.

Canara Bank said in a statement issued on Friday that this reduction has reduced the minimum interest rate for all types of loans. Due to this, the interest on home loan has come down from 7.90 percent per annum to 7.40 percent. At the same time, auto loan has also come down from 8.20 percent per annum to 7.70 percent per annum.

According to the bank's statement, this move reflects Canara Bank's continued focus on customer-centric policies and commitment to support economic progress by enabling easy access to credit. It is worth noting that in its bi-monthly monetary policy review, the RBI had reduced the key policy rate repo by 0.5 percent to 5.5 percent. Along with this, the central bank also announced a reduction of one percent in the cash reserve ratio (CRR) to three percent.