New Delhi, Feb. 6 -- The interest rate on a personal loan is a crucial factor that helps borrowers decide whether to take out a loan or not. Most borrowers keep track of factors that might influence personal interest rates to estimate their borrowing costs. One such factor that has a significant role in determining personal loan interest rates is the Reserve Bank of India (RBI).

The repo rate is the rate at which the RBI lends money to commercial banks. The RBI lends money to commercial banks against collateral such as government securities. The central bank's Monetary Policy Committee (MPC) determines the repo or Repurchase rate by assessing various economic indicators. The MPC comprises six members, including the RBI governor. The MPC ...