IFCI has reduced its ‘IFCI Benchmark Rate’ (IBR) by 50 basis points to 12.20 percent per annum from 12.70 percent per annum.
The revised IBR will be applicable from May 2, a senior IFCI official said.
IBR is akin to a base rate concept applicable for commercial banks. It is the rate below which IFCI will not lend to customers.
A fall in the cost of borrowings coupled with reduction in overheads has prompted the State-owned IFCI to lower its IBR, sources said.
This reduction in IBR is going to attract (towards IFCI) all those customers who had hitherto stayed away from the institution due to perceived high lending rates, they said.
IBR—which is relatively a new concept—is reviewed every quarter.
Currently, IFCI has a loan book of close to ₹ 19,000 crore, of which the loans pegged to IBR is about ₹ 1,500 crore.
The revised IBR will apply to both new loans as well as existing loans linked to IBR.