When the bank OF INDIA' target='_blank' title='reserve bank of india-Latest Updates, Photos, Videos are a click away, CLICK NOW">reserve bank of india (RBI) cuts the repo rate, many home loan borrowers expect their EMIs to drop automatically. After all, most floating-rate home loans are directly linked to the repo rate. However, in reality, banks and housing finance companies do not always pass on the reduction immediately. In some cases, the benefit is delayed—and sometimes, borrowers do not see a change at all.

If your EMI hasn’t decreased even after an RBI repo rate cut, here’s what you need to know and how you can take action.

Why Didn’t Your EMI Reduce? Possible Reasons

1. Reset Period of Your Loan

Most floating-rate home loans have a reset period—typically 3 months, 6 months, or 1 year.
Your EMI changes only at the next reset date, even if RBI cuts rates earlier.

2. bank Hasn’t Updated RLLR/MCLR

Banks revise their lending rates (RLLR for repo-linked loans, MCLR for older loans). If your bank delays updating these values, your EMI update is delayed too.

3. Your Loan is Not Repo-Linked

Older home loans may still be linked to MCLR or base rate, not the repo rate.
In such cases, the impact of a repo rate cut is slower or minimal.

4. Spread/Markup Adjustments

Banks sometimes adjust the spread (margin) over the base rate. Even if the repo rate falls, a higher spread may cancel out the benefit.

What You Can Do: Step-by-Step Complaint Process

If you believe your bank hasn’t passed on the rate cut fairly, follow these steps:

✔ Step 1: Raise a Written Complaint With Your Bank

Contact your bank’s branch or customer care and file a written request:

• Ask for the revised interest rate applicable to your loan
• Request the effective date of rate transmission
• Demand clarity on why the EMI hasn’t changed

Banks must respond within 30 days.

✔ Step 2: Escalate to the Bank’s Grievance Redressal Team

If the branch doesn’t resolve the issue:

• Visit the bank’s official website
• Go to Grievance Redressal
• Submit your complaint with reference number and documents

✔ Step 3: Approach the RBI Ombudsman

If the bank fails to resolve your complaint within the stipulated period or gives an unsatisfactory response, you can file a complaint with the RBI Ombudsman via:

🔹 RBI CMS Portal
🔹 RBI Ombudsman App
🔹 Email or written submission

The Ombudsman investigates issues such as:

• Non-transparent lending rates
• Non-passing of repo rate benefits
• Delay in resetting interest rates

Borrowers usually receive a resolution within 30–60 days.

✔ Step 4: Consider Loan Transfer (Refinancing)

If your bank consistently delays rate transmission, you can switch to another bank/NBFC offering lower rates via home loan balance transfer.

This helps you:

• Reduce EMI
• Lower total interest
• Gain better transparency

Key Takeaway

A repo rate cut should generally benefit home loan borrowers—especially those on repo-linked rates.
If your EMI hasn’t reduced, it’s important to:

Understand the reason

Question the bank

Escalate when needed

Exercise your right to switch lenders

Borrowers do not have to bear the burden of unfair delays or lack of transparency.

 

Disclaimer:

The views and opinions expressed in this article are those of the author and do not necessarily reflect the official policy or position of any agency, organization, employer, or company. All information provided is for general informational purposes only. While every effort has been made to ensure accuracy, we make no representations or warranties of any kind, express or implied, about the completeness, reliability, or suitability of the information contained herein. Readers are advised to verify facts and seek professional advice where necessary. Any reliance placed on such information is strictly at the reader’s own risk.