Overall, the RBI’s policy response reflects a prudent balance between growth and inflation management.
FinTech BizNews Service
Mumbai, 5 August, 2026: The Monetary Policy Committee (MPC) held its 62nd meeting from August 3 to 5, 2026, under the chairmanship of Shri Sanjay Malhotra, Governor, Reserve Bank of India. After a detailed assessment of the evolving macroeconomic and financial developments and the outlook, the MPC voted unanimously to keep the policy repo rate under the liquidity adjustment facility (LAF) unchanged at 5.25 per cent. Consequently, the standing deposit facility (SDF) rate remains at 5.00 per cent and the marginal standing facility (MSF) rate and the Bank Rate remain at 5.50 per cent. The MPC also decided to continue with the neutral stance.
https://fintechbiznews.com/govtregulators/license-for-ucbs-resumed-after-20-yrs
https://fintechbiznews.com/govtregulators/rbi-to-rationalise-basis-on-interest-rates-for-res
https://fintechbiznews.com/govtregulators/rbi-retains-repo-rate
Here are the views of the leading lenders from the NBFCs on the RBI MPC’s decisions, which were announced earlier today:
Umesh Revankar, Executive Vice Chairman, Shriram Finance:
"The RBI’s decision to hold the repo rate at 5.25 per cent is a balanced and pragmatic call. Inflation has risen mainly because of food and fuel, and we are not seeing it spread broadly across the economy, which is reassuring. What stands out for us is the strength in demand on the ground. With tractor sales growing and two-wheelers staying in double digits in Q1, show that rural and semi-urban India is still holding up well, even with monsoon concerns. As a lender to the used and new vehicle operators and first-time buyers, we see this resilience every day. The India growth story remains intact, and this pause gives businesses like ours the clarity to keep supporting credit growth with confidence".
Pinank Shah, CEO, Capital India Finance:
“The RBI’s decision to maintain the repo rate underscores its commitment to stability and prudent policymaking amid an uncertain global environment. By keeping key policy levers available for future action, the RBI has preserved the flexibility to respond to evolving conditions while reinforcing confidence across financial markets. The decision also reflects confidence in India’s resilient domestic demand, sustained investment momentum and healthy export performance, striking the right balance between supporting growth and maintaining macroeconomic stability.”
Sanjay Chaturvedi, Chief Treasury Officer, Namdev Finvest:
Compared with its June policy, the RBI today kept the repo rate unchanged at 5.25% and retained its neutral stance, but marginally improved the FY27 macroeconomic outlook. Real GDP growth is now projected at 6.7%, against 6.6% previously, while inflation is estimated at 5.0%, slightly lower than the earlier 5.1% forecast. The revisions suggest confidence that domestic demand and financial conditions can absorb external pressures without requiring an immediate policy response. India’s economy remains resilient despite geopolitical tensions, volatile energy prices, supply-chain disruptions and El Niño-related uncertainty. Strong private consumption, continuing investment momentum and robust services activity support the growth outlook, although higher input and logistics costs may weigh on selected sectors. Healthy banking-system liquidity and sustained credit demand should aid transmission, while potential FCNR(B) inflows could strengthen foreign-currency funding and ease pressure on market liquidity. The unchanged rate also gives borrowers and businesses greater near-term certainty. However, the RBI is likely to remain vigilant as crude prices, currency movements, food inflation and global monetary tightening could alter the balance of risks.
Overall, the outcome is more optimistic than the previous policy outlook but still cautious: growth expectations have strengthened, inflation concerns have eased modestly, and the central bank has preserved flexibility to respond if conditions change. We, at Namdev Finvest Limited, still maintain a conservative stance amid the hazy outlook due to the dual risks of the West Asia conflict and the effects of El Niño on the Indian economy at large.
For the MSME sector, the past two years have been characterised by regulatory tightening and higher risk-weight requirements, which have strengthened underwriting standards and improved credit discipline across the industry. Asset quality has improved, leverage levels have moderated and credit demand remains healthy. We believe the sector has largely worked through the peak of the stress cycle and is entering a more sustainable growth phase, with better credit quality, lower over-leverage and stronger borrower resilience. MSME credit outstanding grew 16% year-on-year to ₹67.6 lakh crore, while GNPAs improved by around a percent over the past year. In this environment, NBFCs with deep rural and semi-urban presence and strong risk assessment capabilities will be best positioned to support underserved MSMEs and microfinance borrowers while maintaining prudent growth. We expect these markets to remain key drivers of credit demand, supported by improving asset quality, funding availability and stronger borrower fundamentals.
The stable policy environment also provides greater visibility on funding costs and interest rate expectations, enabling NBFCs to undertake more effective balance sheet planning and prudent liquidity management. Going forward, while global uncertainties will continue to be monitored closely, the current policy stance provides the confidence and stability needed to support responsible credit expansion and sustain India's long-term growth momentum."
Mr. George Alexander Muthoot, Managing Director, Muthoot Finance:
"The RBI's decision to maintain the repo rate at 5.25% while retaining a neutral stance reflects a prudent and forward-looking assessment of the evolving macroeconomic environment. Despite resilient domestic demand and an improved FY27 growth outlook, the MPC has rightly acknowledged that geopolitical developments, energy price volatility and global uncertainties continue to warrant vigilance on the inflation front. By maintaining policy continuity while preserving flexibility, the RBI has struck the right balance between supporting growth and safeguarding macroeconomic stability. With the policy rate remaining steady and domestic demand continuing to demonstrate resilience, NBFCs have greater visibility on funding costs and credit planning, creating a conducive environment for sustained disbursements. Stability at this stage of the rate cycle is positive for both lenders and borrowers, as it supports business confidence, encourages productive credit demand and enables timely access to formal finance for households, entrepreneurs and MSMEs. We believe this policy approach will continue to support sustained credit growth across the economy."
Ritesh Jain, Co-founder, FlexiLoans:
“The RBI's decision to maintain the policy rate, while raising the growth outlook and lowering its inflation forecast, sends a strong signal of confidence in India's economic trajectory. For MSMEs, policy stability, coupled with an improving macroeconomic environment, provides greater visibility to plan investments, expand operations and pursue growth opportunities. In our experience, business confidence is often the biggest catalyst for credit demand. As demand conditions improve and inflation remains contained, we expect more entrepreneurs to invest in inventory, capacity expansion and working capital. This also supports healthier credit demand, backed by stronger business fundamentals and improved repayment capacity. India's MSME sector has demonstrated remarkable resilience, and the current macroeconomic backdrop offers an opportunity for businesses to scale with greater confidence.”
Ajitabh Bharti, Co-founder and Executive Director, CapitalXB:
The RBI’s current stance of keeping the policy rate on hold appears well balanced. Given the supply-side measures undertaken primarily by the Government of India, inflation seems to be under control, and this provides the RBI with significant headroom to maintain a neutral stance and keep rates unchanged. I expect this approach to continue in the near term.
While the ongoing US-Iran war continues to cast a shadow over the global inflation outlook, the RBI is likely to remain focused on supporting growth while monitoring inflation carefully. At this stage, inflation appears more likely to be managed through supply-side interventions than through monetary tightening.
Another supportive factor is the healthy outlook for FCNR(B) inflows, which is helping reduce panic in the foreign exchange markets. This, in turn, is contributing to a more orderly currency environment. The rupee depreciation has also remained gradual, which suggests that external pressures are being managed without creating undue volatility.
Overall, the RBI’s policy response reflects a prudent balance between growth and inflation management. In my view, maintaining the current stance is appropriate, as it allows the central bank to preserve stability while remaining alert to global risks.’
