New Delhi, Feb 22 (KNN) Reserve Bank of India's Governor Shaktikanta Das met bankers and exhorted them to ensure better transmission of rate cuts by the central bank.

One of the bankers who attended the meeting said, "The governor said to us that there is a need to reduce our lending rates when the central bank lowers its policy rates, so that consumers benefit."

“We told the Governor we would re-look at the possibilities of cutting lending rates at the next review meeting of MCLR,” a banker present at the meeting said.

Issues of pricing loans based on external benchmarks such as the repo rate or the T-Bills rates was discussed at the meeting, but no conclusion was reached.

Bankers have explained how they price loans and to what extent the repo rate and the central bank’s open market operations (OMOs) influence rates charged to consumers. 

The meeting was attended by representatives of 10 public sector banks and a few private and foreign banks, including Kotak Mahindra Bank, ICICI Bank, IDFC Bank and Citi India.

At the meeting, bankers assured the governor that they will look into their lending rates. (KNN/JM)