The Monetary Board has decided to impose caps on interest rates on pawning facilities at 18 percent, per annum; on pre-arranged temporary overdrafts at 23 percent, per annum; and on credit cards at 28 percent, per annum, for all licensed banks.
Further, the Board was of the view that penal interest rates need to be capped at 2 percentage points over the regular interest rates charged on the relevant credit facility.
In addition to the above, the Board noted that other market lending interest rates on rupee loans and advances should also adjust downwards further, in line with the relaxed monetary policy stance.
Directions to effect these regulated interest rates will be issued shortly. These directions will be subject to further review to ensure that the overall lending interest rate structure remains in line with the monetary policy measures of the Central Bank in the period ahead.