Punjab National Bank Cuts Lending Rates Following RBI’s Latest Policy Move: In a move aimed at making loans cheaper and boosting economic growth, Punjab National Bank (PNB) has cut its Repo-Linked Lending Rate (RLLR) after the Reserve Bank of India (RBI) reduced the repo rate by 50 basis points (bps). The repo rate now stands at 5.5%, down from 6%. As a result, PNB reduced its RLLR from 8.85% to 8.35%, effective June 9, 2025.
This means that many people with loans—especially home loans and car loans—will see their monthly EMIs (Equated Monthly Installments) go down. It also makes it a good time for new borrowers to take loans at lower interest rates. Let’s explore what this really means, how it affects you, and what actions you can take.
Punjab National Bank Cuts Lending Rates Following RBI’s Latest Policy Move
| Feature | Details |
|---|---|
| RBI Repo Rate (June 2025) | Cut to 5.5% |
| Cash Reserve Ratio (CRR) | Reduced to 3% |
| PNB Repo-Linked Lending Rate (RLLR) | Now 8.35% |
| PNB Home Loan Rate | Starts from 7.45% per annum |
| PNB Vehicle Loan Rate | Starts from 7.80% per annum |
| Who Benefits | Both existing and new borrowers |
| Implementation Date | Effective June 9, 2025 |
| Official Source | PNB Official Website |
The recent reduction in the repo rate by the Reserve Bank of India, followed promptly by Punjab National Bank’s decision to cut its Repo-Linked Lending Rate, is a powerful example of how monetary policy can directly benefit everyday people. Whether you’re a salaried individual managing household expenses, a small business owner planning for expansion, or a first-time homebuyer dreaming of your own space, this rate cut can significantly reduce your financial burden.
Lower interest rates mean lower monthly payments, increased affordability, and long-term savings. But it’s not just about numbers—it’s about giving people more breathing room, more choices, and more control over their financial future. In uncertain economic times, every rupee saved counts. And for many families, this small reduction in EMIs can translate to more money for essentials, education, savings, or simply a better quality of life.
As a borrower, the key is to be proactive. Don’t just wait for the savings to come to you—understand your loan terms, speak to your bank, use tools to calculate new EMIs, and consider switching lenders if needed. This is also a reminder of how important financial literacy is. The more you know about how your loans work, the more empowered you are to make the best decisions.
The good news is that opportunities like this don’t come every day. When policy, banks, and market conditions align in your favor, it’s a perfect time to make thoughtful financial moves. Whether you’re reducing your current debt or considering new credit, make this moment work for you.
Great News for Our Valued Customers!
— Punjab National Bank (@pnbindia) June 6, 2025
Punjab National Bank Makes Your EMIs More Affordable!
Following the repo rate cut (6.00% ➝ 5.50%), Punjab National Bank has reduced its RLLR by 50 bps, effective from June 09, 2025.
💸 New Lower Interest Rates:
🏡 Home Loans from 7.45% p.a.… pic.twitter.com/3sj54vSVUD
What Is the Repo Rate and Why Is It Important?
The repo rate is the interest rate at which the RBI lends money to commercial banks. When the repo rate goes down, it becomes cheaper for banks to borrow money. In turn, banks like PNB lower the interest rates they charge you for loans.
So, when the RBI cuts the repo rate, it usually means:
- Cheaper loans
- Lower EMIs
- Increased spending
- Boost in the economy
This is especially helpful when economic growth is slow and inflation is under control, like in 2025.
What Has PNB Done?
Punjab National Bank quickly responded to the RBI’s move by reducing its Repo-Linked Lending Rate (RLLR) from 8.85% to 8.35%. This means:
- Home loan rates now start at 7.45% per annum
- Car loan rates begin at 7.80% per annum
These new rates apply from June 9, 2025, and benefit both new borrowers and existing ones whose loans are linked to the repo rate.
Who Will Benefit from This Change?
1. Existing Borrowers
If you already have a loan from PNB that is linked to the repo rate (also called RLLR), your EMI will go down when your loan resets. Most repo-linked loans reset every 3 or 6 months.
2. New Borrowers
If you’re planning to take a home or car loan, this is a good time. With reduced interest rates, your total repayment amount will be lower, saving you money over time.
EMI Impact: Simple Example
Let’s look at a real-life example to see how much you could save.
Example:
- Loan Amount: ₹40,00,000
- Old Rate: 8.85%
- New Rate: 8.35%
- Tenure: 20 years
| Detail | Before Rate Cut | After Rate Cut |
| EMI | ₹35,374 | ₹34,045 |
| Monthly Savings | – | ₹1,329 |
| Total Savings Over 20 Years | – | ₹3,18,960 |
That’s over ₹3 lakh in savings just by the interest rate being lowered by 0.5%!
What Should Borrowers Do Now?
Step 1: Check Your Loan Type
Find out if your loan is repo-linked, MCLR-based, or fixed rate. This info is available in your loan agreement or online account.
Step 2: Ask About Your Reset Date
Even if your loan is repo-linked, the rate change will only reflect on your next reset date, which is usually every 3 or 6 months.
Step 3: Consider Switching Loans
If your current bank hasn’t lowered rates, you might want to transfer your loan to PNB or another bank that has passed on the rate cut.
Step 4: Use EMI Calculators
Use online tools like the PNB Loan Calculator to compare your EMIs before and after the rate cut.
How Does PNB Compare with Other Banks?
Here is a comparison of home loan rates from major banks (as of June 2025):
| Bank | Starting Home Loan Rate | Repo Linked? | Status |
| PNB | 7.45% | Yes | Cut Applied |
| SBI | 7.50% | Yes | Likely to Cut |
| HDFC Bank | 7.60% | Yes | No Change Yet |
| ICICI Bank | 7.70% | Partial | No Change Yet |
As you can see, PNB is among the most competitive right now.
Borrower Story: Real Impact
Neha Sharma, a teacher from Jaipur, had a home loan of ₹50 lakhs from PNB. After the rate cut, her EMI dropped by ₹1,650. “It might seem small,” she says, “but over time, it adds up. This helps me manage household expenses better.”
This is a real example of how small changes in rates can lead to big long-term savings.
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Final Tips to Make the Most of This Rate Cut
- Compare interest rates across banks before taking a new loan.
- Use online EMI calculators to plan your budget.
- Consider a balance transfer if your current rate is much higher.
- Ask about processing fees before switching banks.
- Stay updated through the RBI website and your bank’s announcements.
FAQs: You Asked, We Answered
Q1: How soon will I see the reduced EMI?
Your EMI will change from your next reset date, usually within 3-6 months.
Q2: Can I ask my bank to switch me to repo-linked rates?
Yes. You can request your bank to switch your loan from MCLR to repo-linked, but a small fee may apply.
Q3: Will fixed-rate loan holders’ benefit?
No. Fixed-rate loans remain the same unless refinanced.
Q4: What if my bank hasn’t reduced rates yet?
You can transfer your loan to another bank like PNB to get better rates.
