How RBI Repo Rate Linkages Affect Your Home Loan EMI

In India, most home loans taken after October 2019 are linked directly to external benchmarks, primarily the RBI Repo Rate. When the RBI raises or cuts the repo rate, banks adjust their lending rates accordingly.

Why does your tenure increase instead of EMI?

To avoid sudden monthly budget shocks, banks usually extend your loan tenure instead of increasing your EMI when rates go up. However, if the tenure exceeds your working age, the bank will increase your monthly EMI amount.