The Reserve Bank of India (“RBI”) by a Press Release dated 31st December, 2020 has declared the applicable average base rate to be charged by Non-Banking Financial Company – Micro Finance Institutions (NBFC-MFIs) to their borrowers for the quarter beginning 1st January, 2021.
The average base rate will be 7.96%.
Background
The RBI by a Circular dated 7th February, 2014 had issued a direction to NBFC-MFIs regarding pricing of credit and stated that it will, on the last working day of every quarter advise the average of the base rates of the five largest commercial banks for the purpose of arriving at the interest rates to be charged by NBFC-MFIs to their borrowers in the ensuing quarter.
Source : Reserve Bank of India
