RBI slashes lending rates and extends moratorium on loan repayment by 3 months to support economic growth

The Reserve Bank of India on Friday cut the repo rate by 40 basis points from 4.4 per cent to 4 per cent, reducing the reverse repo rate at 3.35 per cent to maintain accommodative stance. The RBI Governor Shaktikanta Das while addressing the media said that the six-member Monetary Policy Committee voted 5:1 in favour of 40 bps cut in interest rate. 

The RBI Governor said, measures announced can be divided into four categories — to improve functioning of markets, to support exports and imports, to ease financial stress by giving relief on debt servicing and better access to working capital and to ease financial constraints faced by State Governments.

Granting relief to people the RBI extended moratorium on loan repayments by three more months in view of COVID-19 starting from 1st of June to 31st of August, 2020.