Wed Oct 09 04:10:35 UTC 2024: ## RBI Holds Interest Rates Steady Amidst Inflation Concerns, Focuses on Digital Lending Regulations

**Mumbai, October 9, 2023** – The Reserve Bank of India (RBI) Monetary Policy Committee (MPC) has concluded its three-day meeting, leaving the repo rate unchanged at 6.5%. This decision comes amidst concerns over persistent inflation and a challenging global economic environment.

While the MPC maintained its accommodative stance, four out of six members voted to hold rates steady. The committee expressed cautious optimism about India’s growth prospects, maintaining the FY25 GDP growth forecast at 7.2%. However, the Q1FY25 growth estimate was revised downwards from 7.3% to 7.1%.

The MPC also acknowledged the pressures of inflation, raising the CPI inflation forecasts for Q2 and Q3 of FY25 to 4.4% and 4.7% respectively. This is largely attributed to elevated food prices, a concern that has been a persistent challenge.

Beyond the interest rate decision, the RBI announced significant measures aimed at regulating digital lending platforms. These include:

* **Creation of a centralized database:** This database will allow borrowers to identify legitimate lending apps and avoid fraudulent activities.
* **Regular updates to credit information companies:** These companies will be required to update their databases every 15 days instead of monthly, providing more timely information to consumers.
* **Increased UPI payment limit:** The maximum limit for UPI payments will be raised from ₹1 lakh to ₹5 lakh per transaction.
* **Delegated UPI payments:** This feature will allow individuals to grant other users the ability to make payments on their behalf, facilitating smoother digital transactions.

The RBI also proposed improvements to cheque clearing mechanisms, aiming to expedite the process.

The MPC’s decision to hold rates steady while focusing on digital lending regulation reflects a balanced approach towards maintaining economic stability and facilitating financial inclusion in a rapidly evolving digital landscape.

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