Likely rise in EMIs to hit middle class

Bhubaneswar: The move by Reserve Bank of India (RBI) on Wednesday to hike the key repo rate by 40 basis points (bps) to 4.40% is expected to raise borrowing costs for corporates and individuals at a time when most people are already dealing with rising inflation.
Experts said people paying equated monthly instalments (EMIs) should be prepared for a rise in payments as banks may start raising interest rates on loans soon.
D S Tripathy, a realtor and official of Credai Odisha, said that people are already worried by skyrocketing prices of essential commodities, fuel prices and other products. “Now this move by the RBI will put more pressure on the middle-class people who pay EMIs,” he added.
He said people will face problems in managing their monthly family expenditure and EMIs of house, vehicle and other products. “They will face hard times in the coming days. I hope the RBI will reduce it soon after the situation normalises,” he added.
Dharanidhar Swain, a retired banker, said the hike in repo rate will increase the monthly payments of people who have taken loans from banks. “This RBI decision during the time of rising inflation will hit the customers hard,” he added.
Pramod Nahak, a professional staying in Nayapalli here, said his monthly expenditure has already gone up because of price rise. “Now we will have to pay extra on EMIs. My savings will erode further,” he added.