Home › Circulars › RBI/2025-26/22

Repo Rate Cut by 25 bps to 6.00%

Current · Source: Reserve Bank of India · RBI/2025-26/22 · issued 09 Apr 2025 · ~1 min read
Quick answerRBI cut the repo rate by 25 bps to 6.00% effective April 9, 2025. SDF and MSF rates adjusted to 5.75% and 6.25% respectively. All other LAF terms unchanged.
The rule, in the simplest words
How it plays out — a real example

A treasury officer in Mumbai will review the bank's lending and deposit rate pricing to reflect the lower repo rate, and assess the impact on the net interest margin to adjust treasury operations accordingly, which may lead to more borrowers like Rohan, a small business owner, getting loans at lower interest rates.

What changed

The Monetary Policy Committee reduced the policy repo rate by 25 basis points from 6.25% to 6.00%, effective immediately. Consequently, the SDF rate was adjusted to 5.75% and the MSF rate to 6.25%. All other terms of the LAF scheme remain unchanged.

What it means for you

Banks can now borrow from RBI at a lower repo rate, reducing their cost of funds. This may lead to lower lending rates for borrowers, potentially boosting credit demand. The SDF and MSF rate adjustments ensure the rate corridor remains aligned with the new repo rate.

What you must do

Who it affects

All LAF participants including banks and primary dealers, Borrowers with floating rate loans linked to repo rate, Treasury and asset-liability management teams

❓ Common questions

Regulatory timeline

Built from our lineage records — each fact carries its provenance; missing history simply is not shown (never guessed).

When does the new repo rate take effect?

The repo rate cut to 6.00% is effective immediately from April 9, 2025, as announced in the monetary policy statement.

How do the SDF and MSF rates change?

The SDF rate is adjusted to 5.75% and the MSF rate to 6.25%, both effective immediately.

Are any other LAF terms changed?

No, all other terms and conditions of the LAF scheme remain unchanged.

📜 Read the original circular — full text as issued by RBI
RBI/2025-26/22 FMOD.MAOG.No.151/01.01.001/2025-26 April 09, 2025 All Liquidity Adjustment Facility (LAF) participants Madam/Sir, Liquidity Adjustment Facility - Change in rates As announced in the Monetary Policy Statement dated April 09, 2025 , it has been decided by the Monetary Policy Committee (MPC) to reduce the policy repo rate under the Liquidity Adjustment Facility (LAF) by 25 basis points from 6.25 per cent to 6.00 per cent with immediate effect. 2. Consequently, the standing deposit facility (SDF) rate and marginal standing facility (MSF) rate stand adjusted to 5.75 per cent and 6.25 per cent respectively, with immediate effect. 3. All other terms and conditions of the extant LAF Scheme will remain unchanged. Yours sincerely, (G. Seshsayee) Chief General Manager
Reproduced for reference with acknowledgment — Source: Reserve Bank of India · RBI/2025-26/22 · issued 09 Apr 2025. The plain-English explanation above is BankPulse’s own independent summary.
🧰 Tools — save, print, templates & related
🛠 Banker’s toolkit — checklists & reply templates →
Related circulars · Financial Markets Regulation
RBI Announces ₹1.25 Lakh Crore 2-Day VRR Auction on July 1Overnight VRR Auction Result: June 30, 2026RBI conducts ₹75,000 crore overnight VRR auction on June 30, 2026VRR Auction June 29, 2026: ₹75,021 Cr Allotted at 5.26%Overnight VRR Auction Result: July 29, 2026
Browse all departments →
Who does what — compliance checklist
⚙️ Operations
  • Assess the impact on your net interest margin and adjust treasury operations accordingly.
📜 Compliance
  • Review your lending and deposit rate pricing to reflect the lower repo rate.
  • Communicate the rate change to your asset-liability management committee for strategic planning.
  • Monitor market liquidity conditions as the new rates take effect.
Grouped from the action items above — a single circular may involve more than one team.
Worked example & action-note template

Example: if you are a Compliance officer at a bank this circular applies to (All LAF participants including banks and primary dealers, Borrowers with floating rate loans linked to repo rate, Treasury and asset-liability management teams), your first concrete step on “Repo Rate Cut by 25 bps to 6.00%” is: “Review your lending and deposit rate pricing to reflect the lower repo rate.” (RBI issued this 09 Apr 2025).

  1. Circular: RBI/2025-26/22 -- Repo Rate Cut by 25 bps to 6.00%
  2. Issued: 09 Apr 2025
  3. Action required: Review your lending and deposit rate pricing to reflect the lower repo rate.
  4. Action required: Assess the impact on your net interest margin and adjust treasury operations accordingly.
  5. Action required: Communicate the rate change to your asset-liability management committee for strategic planning.
  6. Action required: Monitor market liquidity conditions as the new rates take effect.
  7. Owner: ____________ Target date: ____________
  8. Board/committee approval needed? Y / N
  9. Evidence filed in compliance register on: ____________
Built only from this circular’s own published fields — not legal advice; always confirm against the official RBI source.

💬 Banker Discussion

Discuss this circular with fellow bankers — reply, upvote what helps, report what doesn’t belong. Be professional; no client data. Views are the commenter’s own, not BankPulse’s.

Loading comments…
BankPulse Compliance Evidence Pack — generated 03 Aug 2026 · status cross-checked against RBI’s official withdrawal register (refreshed weekly).
Official RBI source: https://www.rbi.org.in/Scripts/NotificationUser.aspx?Id=12831&Mode=0 — Plain-English summary by BankPulse (bankpulse.ai), reviewed by our expert reviewer, CA Amit Jain. Independent platform, not affiliated with the Reserve Bank of India; is our own plain-English paraphrase, not RBI’s original wording.
Public beta — plain-English informational summaries. Always verify against the official RBI source (circular number cited on every page) before making compliance, credit, treasury, audit, or operational decisions. · Join our WhatsApp channel ↗
—