A maturing banking market has meant Indians are now borrowing more from the formal financial system than before.
The cost of borrowing, although falling in recent months, is now a fixed factor in most households’ monthly expense.
The following line chart shows the fall in bank loan rates over the years.
For 1991-2000, the SBI Advances rates are taken as the benchmark.
For 2000 onwards, the average lending rates as collated by RBI are taken as the benchmark; wherever there is a range, the lowest end of the range has been taken.
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Charts by Harry Stevens, Research by HT Business Desk