Logo
Munich Personal RePEc Archive

INDIAN Bank Base Rate:An Overview

Dash, Debasis Kumar (2010): INDIAN Bank Base Rate:An Overview. Published in: Niveshak , IIM Shillong Finance Magazine , Vol. 3, No. 9 (30 September 2010): pp. 12-14.

[thumbnail of MPRA_paper_25667.pdf]
Preview
PDF
MPRA_paper_25667.pdf

Download (422kB) | Preview

Abstract

The paper deals about the issues arising out of implementing base rate for Indian banks. With effect from July 1st, 2010, all banks are supposed to lend at base rate or minimum level of interest rate to customers. The net impact of this for retail customer will not be much as cost of funds for banks are not going to change much and cost of funds determine base rate. Big corporates will be biggest losers as they had advantage of getting loans at sub-base rates. Biggest gainers will be small and medium firms who were getting raw deal earlier from banks. Banks may lose market share in short term but there is going to be greater transparency and trickling down of policies made by RBI across banks due to base-rate system. Game theory has been applied to explain the base rate transition scenario in the paper.

Atom RSS 1.0 RSS 2.0

Contact us: mpra@ub.uni-muenchen.de

This repository has been built using EPrints software.

MPRA is a RePEc service hosted by Logo of the University Library LMU Munich.