A reduction in rates cuts down customers’ EMI burden and opens up further avenues towards homeownership
FinTech BizNews Service
Mumbai, 5 December 2025: The Monetary Policy Committee (MPC) held its 58th meeting from December 3 to 5, 2025, under the chairmanship of Shri Sanjay Malhotra, Governor, Reserve Bank of India. The MPC voted unanimously to reduce the policy repo rate under the liquidity adjustment facility (LAF) to 5.25 per cent. Consequently, the standing deposit facility (SDF) rate shall stand adjusted to 5.00 per cent and the marginal standing facility (MSF) rate and the Bank Rate to 5.50 per cent. The MPC also decided to continue with the neutral stance.
Rishi Anand, MD & CEO, Aadhar Housing Finance, explains the effect of rate cut on housing segment:
“The RBI’s decision to reduce the repo rate by 25 bps brings the total reduction this year to 125 bps, marking the fourth rate cut in 2025 and reflecting its continued focus on supporting economic growth along with improving liquidity. This cumulative rate cut has and will bring favourable relief to borrowers, especially first-time homebuyers in the affordable housing category, as a reduction in rates cuts down their EMI burden and opens up further avenues towards homeownership.
For EWS and LIG customers, even a small rate reduction can make homeownership more accessible and boost their confidence to take the step towards owning a home. With strong demand emerging from Tier 2 and Tier 3 cities and continued government support through schemes like PMAY, the environment remains highly favourable for affordable homebuyers. This will further energise the segment and help more families move closer to securing their first home.”
