What is EBLR?
External Benchmark Linked Rate (EBLR) is the system that determines floating interest rates on home loans in India.
Understanding EBLR
Since October 2019, RBI mandated that all floating rate loans be linked to external benchmarks. Your home loan rate = EBLR + Spread.
- EBLR: External benchmark (usually RBI Repo Rate)
- Spread: Fixed margin added by lender
- Reset Frequency: Usually quarterly or half-yearly
- Spread Lock-in: Spread remains constant during tenure
Common External Benchmarks
- RBI Repo Rate (most widely used)
- 91-day T-Bill yield
- 182-day T-Bill yield
- Government Bond yields
Benefits of EBLR
- Transparent rate transmission
- Faster rate changes when RBI changes policy
- No arbitrary rate changes by lenders
- Better for borrowers in falling rate environment
Disclaimer: This guide is for educational purposes only. Please check with your lender for specific EBLR details.