Which is better, MCLR or repo rate?

In the case of MCLR linked loans, the result of increase in repo rate is going to take some time to be passed on to the borrower, whereas in the case of repo rate linked loans, the transfer of repo rate change will be transmitted faster.You can read about The Reserve Bank of India: Functions and Composition in the given link.

Further readings:

  1. Non Performing Assets (NPA) – Facts for UPSC GS-III
  2. Monetary Policy – Objectives, Roles and Instruments

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