Assuming the rate kicks in from April 1 after 12 EMIs of this loan have been paid, then one can get per-lakh interest savings of Rs 3002 from the rest of the year.

But it is still to be seen how banks respond to this RBI rate cut and how soon they give relief to home and personal loan borrowers. Because in the past we have seen that the government and the RBI had to nudge banks to give the benefit of rate cuts to borrowers as the lenders showed unwillingness in passing on the cuts.

In a significant step to boost economic growth, the Reserve Bank of India (RBI) has slashed the repo rate by 25 basis points (bps), reducing it from 6.5 per cent to 6.25 per cent, in its first monetary policy review of the calendar year.