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      Question

      What is the benchmark rate banks must use for pricing

      all rupee loans to MSMEs as per RBI (from October 2019)?
      A MCLR Correct Answer Incorrect Answer
      B Base Rate Correct Answer Incorrect Answer
      C Bank Rate Correct Answer Incorrect Answer
      D Repo Rate Correct Answer Incorrect Answer
      E External Benchmark (like Repo, T-Bill, etc.) Correct Answer Incorrect Answer

      Solution

      RBI mandates linking new MSME loans to external benchmarks like Repo, T-Bills, etc., to improve transparency and transmission.

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