As part of a structural change to make banking more robust and transparent, the Reserve Bank of India (RBI) has directed banks to adopt an external benchmarking mechanism starting 1st October 2019.

Amid the new regulations, all banks will now finalize interest rates on floating rate loans using an external benchmark index replacing the current Marginal Cost of Funds-based Lending (MCLR) system.

Read the full article published originally on Financial Express: MCLR or External Benchmarks: Which is better for loans?