DBOD

DBOD.No. Dir.BC.33/13.03.00/98

April 29, 1998

Vaisakha 9, 1920 (Saka)

Interest Rates On Advances

In exercise of the powers conferred by Sections 21 and 35A of Banking Regulation Act, 1949, the Reserve Bank of India, being satisfied that it is necessary and expedient in the public interest so to do, hereby directs that, with effect from such dates as may be announced by respective banks, the Annexure to its Directive DBOD. No. Dir. BC. 18/C.96/90 dated September 21, 1990, as amended from time to time, shall be substituted by the revised Annexure enclosed to this Directive.

2. All other terms and conditions contained in the said Directive dated September 21, 1990 ibid, as amended from time to time, shall remain unchanged.

(S.Gurumurthy)

Executive Director

ANNEXURE

Interest Rate structure excluding Interest Tax

for rupee advances of commercial banks

Rate of interest

(Per cent per annum)

Size of limit

Existing

All advances including Term loans

Revised

1. (a) Upto and inclusive

of Rs. 25,000

12.0

Not exceeding

Prime Lending Rate (PLR)

(b) Over Rs. 25,000 and

upto Rs. 2 lakhs

13.5

Not exceeding

Prime Lending Rate (PLR)

Free

2. (i) Loans for purchase

of consumer durables

Free

(ii) Loans to individuals against shares and debentures/bonds	Free	Free
(iii) Other non-priority sector personal loans	Free	Free
Lending rate for commodities coming within the purview of Selective Credit Control (SCC)
Loans/Advances/Cash Credit/Overdrafts against commodities subject to SCC	Free	Free
4. Export Credit (1) Pre-shipment Credit
(i) (a) Upto 180 days	12.0	11.0
(b) Beyond 180 days and upto 270 days	14.0	14.0
(ii) Against incentives receivable from Government covered by ECGC Guarantee (upto 90 days)	12.0	11.0
(2) Post-shipment Credit
(i) Demand bills for transit period (as specified by FEDAI)	Not exceeding 11.0	Not exceeding 11.0
(ii) Usance Bills (For total period comprising usance period of export bills, transit period as specified by FEDAI and grace period wherever applicable)
(a) Upto 90 days	Not exceeding 11.0	Not exceeding 11.0
(b) Beyond 90 days and upto 6 months from date of shipment	13.0 (for the period beyond 90 days)	13.0
(iii) Against incentives receivable from Government covered by ECGC Guarantee (upto 90 days)	Not exceeding 11.0	Not exceeding 11.0
(iv) Against undrawn balances (upto 90 days)	Not exceeding 11.0	Not exceeding 11.0
(v) Against retention money (for supplies portion only) payable within one year from the date of shipment(upto 90 days)	Not exceeding 11.0	Not exceeding 11.0
3. Deferred Credit Deferred credit for the period beyond 180 days	Free	Free
4. Export Credit not otherwise specified	20.0 (minimum)	_
(a) Pre-shipment credit	_	Free
(b) Post-shipment credit	_	20.0
5. DRI advances	4.0	4.0
6(a) Finance granted to intermediary agencies (excluding those for housing) for onlending to ultimate beneficiaries and agencies providing ficiaries and agencies providing input support,.	6(a) Finance granted to intermediary agencies (excluding those for housing) for onlending to ultimate beneficiaries and agencies providing ficiaries and agencies providing input support, the rate will be 1.5 percentage points below each bank's Prime Lending Rate for credit limits in the category of advances over Rs.2 lakhs.	No Change
6(b) Finance granted to housing finance intermediary agencies for onlending to ultimate beneficiaries.	6(b) Finance granted to housing finance intermediary agencies interest at different rates provided they are below the applicable Prime Lending Rate.	No Change
Note : Where loans are routed through PACS/LAMPS/FSS, the rate of interest to be charged by banks to the PACS/LAMPS/FSS shall be 1.5 percentage points lower than the rates to the ultimate borrowers indicated in item 1(a) and 1(b) above. In respect of item 1(c), the rate will be 1.5 percentage points below the appropriate Prime Lending Rate of each bank.