Base Rate

byPaytm Editorial TeamLast Updated: August 19, 2025

Definition

The Base Rate is the minimum interest rate set by the Reserve Bank of India (RBI) that banks must charge on loans.

Purpose

Introduced in 2010, the base rate ensures transparency and prevents banks from charging very high or arbitrary rates.

Benefits

  • Fair loan pricing
  • Protects borrowers
  • Brings uniformity in lending practices

Author

Paytm Editorial Team

The Paytm Editorial Team is a collaborative group of writers, editors, and industry experts. We're dedicated to bringing you the latest insights, news, and guides on digital payments, financial services, and the technology that's shaping India's economy. We offer easy-to-follow guides and insights to help you explore Paytm’s products, features, and services. Our goal is to provide clear, reliable, and helpful information to empower you on your financial journey.

You May Also Like

Branchless BankingLast Updated: September 10, 2025

Definition Branchless Banking means providing banking services without a physical branch. It uses technology like mobile banking, ATMs,…

AML Full Form & MeaningLast Updated: February 14, 2025

What is the full form of AML in banking & finance? The full form of AML is Anti-Money…

Peer-to-Peer (P2P) TransferLast Updated: July 11, 2025

Introduction Peer-to-Peer (P2P) Transfer is a UPI payment between two individuals for personal reasons like rent, gifts, or…

Mobile BankingLast Updated: August 12, 2025

Definition Mobile Banking is a service that allows users to perform banking transactions using a mobile phone. It…