What is the retail prime lending rate or RPLR?
May 05, 05:05

Retail prime lending rate, or RPLR, is the rate at which housing finance companies (HFCs) lend to their most creditworthy customers. It is the benchmark against which these lenders price their loans to customers. It is derived from the average cost of funds for the HFC. Housing financiers charge a spread over the rate for other customers to compensate for taking a higher credit risk. The final lending rate would include the credit risk spread and the tenure premium. An increase in RPLR would increase the interest burden on the borrower and consequently lead to a rise in equated monthly instalments (EMIs).

Decoding RPLR