Repo Rate: Good News! RBI May Cut Loan Rates Again, EMIs Could Get Cheaper

Repo Rate Update:
The Reserve Bank of India (RBI) is likely to reduce the repo rate by 0.25% during the Monetary Policy Committee (MPC) meeting scheduled from April 7 to April 9, 2025. If this happens, loans will become cheaper and EMIs lighter on your pocket. A similar cut was made in February as well, driven by easing inflation and global economic trends.

RBI May Bring More Relief

India’s central bank — the Reserve Bank of India (RBI) — might soon deliver some relief.
Experts predict that during the MPC meeting from April 7 to 9, the RBI could cut the repo rate by 0.25%.
If that happens, it will directly impact your EMI payments, reducing your financial burden.

A Similar Cut Was Made Earlier

Back in February 2025, the RBI had reduced the repo rate by 0.25%, bringing it down to 6.25%.
This was the first cut in two and a half years.
If the RBI makes another similar move now, the new repo rate would be 6% — definitely a welcome relief for borrowers.

What Exactly Is the Repo Rate?

Let’s break it down simply:
The repo rate is the interest rate at which the RBI lends money to commercial banks for the short term.
When the repo rate decreases:

• Banks can borrow funds at a lower cost.

• In turn, banks offer cheaper loans to customers.

• This means home loans, car loans, personal loans become more affordable.

• As a result, EMIs fall, giving borrowers a breather.

Why Is RBI Cutting the Repo Rate?

A few reasons:

• Inflation in India has cooled down a bit.

• Global economies — especially the US — are tightening tax and trade policies, affecting worldwide growth.

In this situation, India needs to boost its domestic demand.
The easiest way?
Make loans cheaper so that people spend more, businesses grow, and the economy stays vibrant.

What Should Borrowers Do?

• If you already have a floating rate loan, be happy! Your EMI may go down soon.

• If you’re planning to take a new loan, it might be wise to wait a few more days.

The MPC meeting results will be announced on April 9 — after which you could lock in a better loan deal.