RBI MPC October 2025 Repo Rate Unchanged: Will Your Car Loan Get Cheaper?

The RBI’s Monetary Policy Committee (MPC) concluded its three day meeting on Wednesday, leaving the repo rate unchanged at 5.5%. The standing deposit facility (SDF) rate remains at 5.25%, while the marginal standing facility (MSF) rate and Bank Rate are unchanged at 5.75%.

Earlier this year, the RBI had cut the repo rate by 100 basis points in three tranches to support growth as inflation moderated. In the August 2025 policy review, the central bank had opted for a wait and watch approach, assessing global developments like US tariffs and their impact on India’s economy.

Will Your Car Loan EMI Drop After RBI Announcement?

With the repo rate unchanged, car loans are unlikely to get cheaper immediately. Since the repo rate determines the cost at which commercial banks borrow from the RBI, any cut usually flows down to consumer loans.

• No change in repo rate → banks’ lending costs remain stable → car loan EMIs likely unchanged.
• Planning benefit → Stability in rates helps borrowers plan EMIs and budgets without sudden surprises.
• Future possibility → If the RBI reduces rates in upcoming meetings, banks may lower interest rates on car and home loans.

How Repo Rate Affects Your Car Loan Costs?

The MPC’s primary role is to decide the repo rate, the “price of money” for the economy:

• Lower repo rate: Banks can lend cheaper loans for cars, homes, and businesses may become more affordable.
• Same repo rate: Stability in borrowing and investment decisions.
• Higher repo rate: Borrowing costs increase to control inflation.

Read More: RBI Unveils New Digital Payment Authentication Rules: 2FA Mandatory, More Options Beyond SMS OTP from April 2026.

Conclusion

The RBI’s decision to maintain the repo rate at 5.5% signals policy stability for borrowers and investors. While car loans are unlikely to become cheaper immediately, the stable rate environment allows for better financial planning. Future rate changes will determine whether EMIs on car and home loans may decrease.

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