Yet, no bank has been taken to task for its actions, says Harsh Roongta.
The final guidelines to link the interest rate to external benchmarks will be issued by the end of this month
The Reserve Bank of India has stated that banks cannot levy charges on paper-based transactions.
In India, water shortages are particularly serious simply because the margin between actual food consumption and survival is so precarious.
'If the new rate is lower than your current rate, ask your bank to shift you to it.' 'This can be done by paying a fee of Rs 5,000 to Rs 6,000.'
It is clear as daylight to anyone that a charge or a cost to simply reduce interest on a floating rate loan is extortion, but this is exactly what the RBI has officially sanctioned, says Debashis Basu.
The bank, however, maintained that the incremental benefit from the MCLR based lending rates introduced in April 2016 as an alternative to the earlier system of base rate, was positive.
Banks argued that loans of most lenders are funded primarily by retail deposits and not from the wholesale market as was the practice abroad
Banks are cheating customers with rates that are unfairly high, discriminatory, and opaque, denying legitimate savings to borrowers, while the RBI has been looking the other way, says Debashis Basu.
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