RBI On Gold Loan: The Reserve Bank of India has doubled the loan against gold (gold loan) under the Bullet Repayment Scheme for Urban Cooperative Banks to Rs 4 lakh.
RBI On Gold Loan: The Reserve Bank of India (RBI) has doubled the loan against gold (gold loan) under the Bullet Repayment Scheme for Urban Cooperative Banks to Rs 4 lakh. This limit has been extended for those urban cooperative banks which have met all the targets under priority sector lending till March 31, 2023.
What did RBI say
Bullet for urban co-operative banks (UCBs) that have completed sub-targets up to the overall target under Priority Sector Lending (PSL) by March 31, 2023, RBI Governor Shaktikanta Das said while announcing the bi-monthly monetary policy review. It has been decided to increase the existing limit of gold loan from Rs 2 lakh to Rs 4 lakh under the repayment scheme.
Under the ‘Bullet’ repayment plan, the borrower repays the principal amount and interest in one lump sum at the end of the loan tenure. Although the interest on loan against gold is calculated every month throughout the tenure, the principal amount and interest have to be paid in one go. That is why it is known as ‘bullet’ repayment.
Das said, “This measure is in line with our earlier announcement that UCBs that meet the prescribed priority sector lending targets by March 31, 2023 will be given appropriate incentives.” It was said in the monetary policy review that appropriate incentives will be given to urban cooperative banks that meet the targets set under credit to the primary sector by March 2023.
RBI on Friday kept the policy rate repo at 6.5 percent for the fourth consecutive time. This means that there will be no change in the monthly installment (EMI) on various loans including house, vehicle.
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