1.

What Is The Meaning Of “base Rate”?

Answer»

Base Rate is the minimum rate of INTEREST which a bank has to CHARGE from its CUSTOMERS and a bank can’t sanction loan on a rate below the base rate. Banks may choose any benchmark to DECIDE on the base rate.

The exceptions of base rate are:-

  • Agriculture loans
  • sponsored schemes
  • Staff loans
  • Only under the above cases, bank can lend below base rate.
  • Only under the above cases, bank can lend below base rate.

Base Rate is the minimum rate of interest which a bank has to charge from its customers and a bank can’t sanction loan on a rate below the base rate. Banks may choose any benchmark to decide on the base rate.

The exceptions of base rate are:-


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