RBI Monetary Policy: There is an important update for those people who have accounts in urban co-operative banks. A new rule has been issued by the Reserve Bank of India for co-operative banks. According to which, if customers need, they can take gold loan under the ‘Bullet’ repayment scheme. Let us know the complete details of this scheme…
New Delhi: 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 increased for those urban co-operative banks,
Who have completed all the targets under loans to the primary sector by 31 March 2023. The benefit of this relief given by RBI to the banks will be available to those customers who have accounts in urban co-operative banks and take gold loan as per their need.
Payment of principal amount and interest together
Announcing the bi-monthly monetary policy review, RBI Governor Shaktikanta Das said, ‘Urban Co-operative Banks (UCBs) which have completed the sub-target up to the overall target under Priority Sector Lending (PSL) by March 31, 2023.
For such banks, it has been decided to increase the existing limit of gold loan from Rs 2 lakh to Rs 4 lakh under the Bullet Repayment Scheme. Under the ‘Bullet’ Repayment Scheme, the borrower can repay the principal amount and interest. Repayment is made in lump sum at the end of the loan tenure.
Why is it called ‘bullet’ repayment plan?
However, the interest on loan against gold is calculated every month throughout the tenure. But the principal amount and interest have to be paid once. That is why it is known as ‘bullet’ repayment.
Das said, ‘This measure is in line with our previous announcement that UCBs that meet the priority sector lending targets by March 31, 2023 will be given appropriate incentives.’
RBI had said in the monetary policy review in June this year that appropriate incentives will be given to urban cooperative banks that meet the targets set under loans to the primary sector by March 2023.
RBI on Friday maintained the policy rate repo rate at 6.5 percent for the fourth consecutive time. This means that there will be no change in the monthly EMI on various loans including home and vehicle.