Despite the Reserve Bank of India (RBI) making loan pricing more transparent by linking it to external benchmark rates, from October 2019, most banks don't seem to have informed their customers about the move.

This is precisely what happened to one of wealth manager Pallav Bagaria’s clients. On analysing her repayment schedule earlier this year, he found that her home loan, taken in 2006, was linked to the base rate, with the effective home loan interest being 12.2 per cent. This, at a time, when several banks and housing financing companies were charging new borrowers around 8-9 per cent annually.

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