What is EBLR (External Benchmark Lending Rate)?
The benchmark banks use to price floating-rate loans, linked to the policy repo rate.
Since 2019, banks link floating retail loans to an external benchmark (usually the policy repo rate) plus a spread. When the the central bank changes the repo, your EBLR-linked EMI changes too.
Example
EBLR = repo (5.25%) + spread (e.g. 3.25%) = 8.5%.
What EBLR is
The External Benchmark Lending Rate is the floor a bank uses to price floating-rate loans. Instead of an internal, opaque benchmark, the bank ties your rate to a published external benchmark — most commonly the central bank's policy (repo) rate — plus a fixed spread that reflects its costs and your credit risk.
Why it matters to you
Because the benchmark is public, rate changes are transparent and reach borrowers faster: when the central bank cuts or raises the policy rate, EBLR-linked loans re-price at the next reset. When comparing loans, look at the spread over the benchmark, since that is the part the bank controls.