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The middle class and other loan payers will get relief if the banks go for more rate cuts in the coming days and weeks. The impact will be a pro-borrower, as their EMIs will come down at sharp.

Finance Minister Arun Jaitley, has said the possibilities of the banks to cut the crucial rates. During his meeting with the heads of the Public Sector Banks, he reportedly discussed about the capital generation to meet the norms. Post meeting, he told reporters about the fund generation and expressed confidence in the growth.

He also said that the government would also consider the ways to encourage capital generation as prescribed in the budget. He also said the banks have given clear presentation about reducing the lending rates.

"Some part of it (rate cut) have been passed on to customers, while some banks have not passed on. I feel over the next few days ... some of the bankers felt that over the next few weeks, they would be in a position to work out greater cuts," the Minister said.    

The recent rate cuts with the respect to the moves of RBI are working well. The Central Bank of India (RBI) has reduced the repo rate by a total of 0.75 per cent in three phases.

-Kannamsai