By: Mr. George Alexander Muthoot, MD of Muthoot Finance

We welcome the RBI’s latest monetary policy decisions under the leadership of the newly appointed Governor, Sanjay Malhotra. The central bank’s neutral stance, focused on balancing stability with growth, underscores a prudent approach to strengthen India’s economic resilience amid global uncertainties. The 25 basis point reduction in the repo rate to 6.25%—the first cut in nearly five years—signals a decisive step toward supporting economic growth and consumption. This move aligns with the government’s post-Budget 2025 efforts to stimulate demand, providing much-needed liquidity while easing borrowing costs for businesses and individuals. With inflation under control and GDP growth projected at 6.7% for FY26, the rate cut is well-timed to accelerate credit expansion and economic activity. India’s economic momentum, fueled by strong household consumption, a revival in rural demand, and improving employment conditions, will be further supported by reduced borrowing costs on gold loans. This is expected to drive increased demand for gold loans across the country. As a trusted financial partner, we remain committed to leveraging this favorable environment to provide accessible and affordable credit solutions.

We also commend the RBI’s proactive measures to enhance cybersecurity and mitigate financial fraud, including the launch of Bank.in and Fin.in and the introduction of Additional Factor of Authentication (AFA). These initiatives will strengthen India’s leadership in the digital banking space, fostering greater financial inclusion while safeguarding customer interests.