RBI

Average base rate charged by NBFC-MFIs to their borrowers from January 2021 to be 7.96%

Average base rate charged by NBFC-MFIs to their borrowers from January 2021 to be 7.96%

Average base rate to be charged by NBFC-MFIs to their borrowers for quarter beginning January 1, 2021 notified at 7.96 per cent.

Reserve Bank of India (RBI) has communicated that the applicable average base rate to be charged by Non-Banking Financial Company – Micro Finance Institutions (NBFC-MFIs) to their borrowers for the quarter beginning January 1, 2021 will be 7.96 per cent.

RBI has mandated that the from the quarter beginning April 2014 interest rates charged by an NBFC-MFI to its borrowers will be the lower of the following:

(i) The cost of funds plus margin or

(ii) The average base rate of the five largest commercial banks by assets multiplied by 2.75.

The average of the base rates of the five largest commercial banks shall be advised by the Reserve Bank on the last working day of the previous quarter, which shall determine interest rates for the ensuing quarter.

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