Vispy Doctor, an XLRI alumnus is the founder and managing director of Ormax Money. Vispy Doctor started Ormax Consultants in 1985 as a specialist qualitative research company. Ormax Money offers customized services, consulting and subscription based products to clients. A consumer understanding and knowledge firm, Ormax Money empowers decision makers in the financial sector with consumer insights to enhance profitability.

vispy.doctor:035138 : Hi I have logged in. System working fine.
Yogita.khatri:035947 : Good Evening Sir, welcome to myiris live chat
vispy.doctor:040138 : Good evening Yogita.Looking forward to this chat.
Vivek Khosla:040114 : Good Evening Mr. Doctor Does Base Rate have a positive or negative affect on the home loan takers. Can you please elaborate on various time periods for a home loan borrower? For e.g if I want to return my loan in 5 yrs /10 yrs how will base rate affect me.
vispy.doctor:040254 : Hi Vivek, as of now it has no effect.Base rate is only an input in working out the final home loan rate to the customer.
vispy.doctor:040404 : No effect really on tenor of home loan either. So work towards returning your home loan in a time period comfortable to you.
vispy.doctor:040444 : Base rates will also be reviwed regularly.
Sanjay:040533 : I have taken loan on floating rates keeping in mind that the bank interest rates fluctuate. Will the bank adjust the interest rate or will it be the same.
vispy.doctor:040725 : Sanjay, rates will fluctuate now as a premium on the base rate. So banks will adjust rate on floating rates.
Kapil:040600 : How is BR diffrent from BPLR
vispy.doctor:040850 : In BPLR you could very easily lend below the BPLR rate, The BR is fixed. All leding will be above it only.So in a way the lowest rate is now set.
Jyotsna:040654 : what does BR mean for corporate borrowers
vispy.doctor:040925 : There will hence be some sanctity to rates
Kapil:040943 : Thank you Dr Vispy
vispy.doctor:041023 : Jyotsna basically corporates would not enjoy highly subsidized rates which was available earlier
Namita:040848 : Can a customer move from the BPLR to BR regime before the expiry of the current BPLR-linked loan tenure
vispy.doctor:041059 : Some believe corporates will move more towards commercial paper
vispy.doctor:041130 : Namita- all rates will get pegged to BPLR
Sheetal:041016 : Does Base rate fluctuate Every Quarter, Does it have any effect on CRR and SLR
vispy.doctor:041328 : Base rate wont have any effect on CRR/SLR. IT may depend on them.
vispy.doctor:041425 : Banks have calculated BR using cost of deposits over last 1 yr. changes in CRR/SLR do impact the cost of deposits ( rate given to us on depoisiting money in bank)
vispy.doctor:041449 : It will be reviwed regularly.
Snehil:041115 : Dr Vispy how would Base Rate impact retail customers
vispy.doctor:041519 : namita, sanjay- hope your questions were answered?
Mrs Ishika Jain:041544 : I want to take Home loan to buy a house but there are different Base rates in most of the banks. Which bank should I opt for.
vispy.doctor:041617 : Snehil- basically it means rate will not go below the BR. which is between 7.5-8.75%. so a retail customer shd not expect rate below that
Sanjay:041614 : Can you please give an example
vispy.doctor:041655 : Mrs Jain- evaluate the offer of a bank in terms of LTV, RATE, Convenience, documentation etc...
vispy.doctor:041726 : Sanjay- example of?
Rohit:041728 : So with base rate into effect, which would be more economical for home loan borrowers, floating or fixed? Both will be based on the base rate, which is comparatively lower to BPLR??
vispy.doctor:041954 : Yes BR has been fixed around 8%..hence lower than BPLR. floating or fixed rates depends on outlook of the economy going ahead.. if long term rates will decline then floating.
vispy.doctor:042052 : if rates move up because of excess inflation etc..fixed may be better.
John D`souza:042109 : Mr. Doctor, I have taken home loan rate for 8.5% for the first year and then later it will be 9.5 % for three years . Should I change to Basr rate or will it change automatically.
vispy.doctor:042216 : John, if you have taken a fixed rate loan, your rates are fixed. I suggest you dont change as changing comes at a price.
John D`souza:042309 : But I won't I benefit more if I change to Base Rate?
vispy.doctor:042355 : John, any price change by bank will happen automatically.
Viraat:042105 : In terms of short term funds, can the banks lend below the base rate.
vispy.doctor:042507 : No. I dont think so
John D`souza:042539 : Ok . Thank you for your advice Mr.Vispy Doctor. Quite useful I was debating what to do
vispy.doctor:042620 : Welcome John...best of luck!
Viraat:042625 : Are you very sure of that Mr. Doctor?
Sharad Kohli:042341 : Do you think one shoud go with a bank with a lower base rate
John D`souza:042752 : Nice chatting with you. Wanted to ask you few more questions but got to go. When will you come again on the chat
vispy.doctor:042828 : Sharad- evaluate loan basis convience, service level, ease of documentation, amt of loan given etc and rate.
vispy.doctor:042935 : virat- I am sure, with base rate banks have a bettr bargaining power with corporates
Suraj Bajaj:042635 : Is any change in the BR make interest rate lower? Will my EMI change?
Sharad Kohli:043050 : Sir can u please elaborate
vispy.doctor:043130 : suraj- right now nothing will happen. if a bank reprices then yes.
Shubhank Gupta:042105 : SBI sets base rate at 7.5%: What does this mean for investors
Rohit:043229 : If one goes for a home loan now, the bank will offer fixed and floating rate, at the same base rate fixed, or some premium will be charged in case of fixed? I have heard that flaoting rate is normally less than fixed, how far is that true?
vispy.doctor:043318 : sharad- rate of loan is a part of the selection of bank for taking loan, lowest base rate dosent mean best bank etc..there are banks at 7% ( dhanlaxmi), 7.5% ( hdfc.) and 8.5% ( karnataka)
vispy.doctor:043425 : rohit- effectively they work out to the same.now all loans will be base rate premium.
Sheetal:043436 : Does the bank OD rate in anyways depend on the base rate?
vispy.doctor:043517 : shubhank- as investor you mean people depositing money in bank or people taking loans to invest in houses?
Anshul Kaushik:043521 : What is the effect of base rate on term deposit intrest rates?
vispy.doctor:043619 : sheetal- od rate may not.
vispy.doctor:043717 : anshul-- base rate wont affect term deposit rate. the term deposit rates will depend on crr/slr.repo rates etc...and banks needs to raise liquidity/ pick money from amrket
Avinash Pande:043728 : How often can Bank change its Base Rate. What does it mean for retail customers .What does it mean for corporate borrowers
vispy.doctor:044017 : For all borrowers it means a base rate below which banks will not go/ lend.So those who had access to credit at rates below 7-8% will have to go to other sources to maintain that rate.
Tarun Kohli:043857 : I know the Banks and Building societies move their rates when this changes but what does "Base rate" actually mean? Does it mean that Bank Of England may be willing to lend money out to say at 0.5%
Tarun Kohli:044048 : The bank of England base rate is currently 0.5% but what does his actually means?
vispy.doctor:044119 : avinash- i think the rates would get reviwed qtrly.I am not sure on this.
vispy.doctor:044215 : Base rate is a fixed rate below which banks will not lend. Its their avg cost of deposits ( ie getting money from us) a mark up to maintain their operations etc.
vispy.doctor:044340 : This is important as banks have to maintain a minimum spread to stay healthy and serve us better ie invest in new prodicts/ branches/ service levels etc
Sheetal:044301 : How would you describe India's Base Rate vis-avis be Global Base Rate For eg US , Europe
Avinash Pande:044340 : Can you please check and let me knowThomas:044122 : I heard that corporate borrowers have been major losers with this regime? Does that mean that prior to the implementation of base rate system, corporate borrowers were offered loan at cheaper rates than set by BPLR? Is that the main concern why RBI proposed the base rate regime?
vispy.doctor:044437 : for every country the logic of pricing would be the same. I think we have a fantastic and transparent system in splace
vispy.doctor:044457 : sure avinash, if we can have your mail id we could
Tarun Kohli:044356 : Mr Vispy commercial banks need to keep an average reserve each month and is the average is lower or higher it needs to pay interest at base rate to BoE but if remains an average same, then the BoE pays commercial bank. So, my question is, if commercial banks can borrow money from BoE at base rate then they will never go higher or lower than the monthly average.
vispy.doctor:044602 : thomas- if corporates were picking money from banks at rates lower than BR then yes, their cost of capital goes up or they have to look for other modes to finance
Moonmoon:044637 : How does the base rate affect pre-existing loan?
vispy.doctor:044732 : Moonmoon- your exisitng loan would continue as normal.
Krishna:044747 : Wil the new borrowers get loan at cheaper rates, compared to borrowers before base rate system? Can the existing borrowers shift to base rate system? If yes, will there be a charge for it?
vispy.doctor:044841 : tarun in India we have repo and reverse repo which are changed depending on the economic condition.
vispy.doctor:045015 : Krishna- any loan prog change ie shifting banks comes at a cost. Loan rates may not get impacted much.As base rate would be an input into final rate offered. it also depends on delinquncy, costs of deposits, cost of operations etc
Pankaj Kothari:045022 : Will the base rate be fairer than BPLR?
vispy.doctor:045127 : Pankaj- It shd be.Its a more transparent rate and shd be fairer
Vidya Kapoor:045255 : Can a customer move from the BPLR to BR regime before the expiry of the current BPLR-linked loan tenure
vispy.doctor:045409 : all new loans are on BR effective 1st july. do chk with your bank on what they plan to do.
Vidya Kapoor:045429 : Can the Base Rate remain static for the period that you take loan for or it does very time to time?
Anuj:045548 : Is the base rate system good for private banks like HDFC, ICICI Bank?
vispy.doctor:045619 : base rates like plr will vary. now banks will make policies if on if your rates hsd flucuate or stay stable.
Sudipto:045616 : How is the base rate calculated
vispy.doctor:045700 : Anuj- BR would help the entire industry and is a regulatory requirent
Yuvraaj:045714 : I had taken home loan for 10 years I have paid 17 installments. I can finish my entire home loan as I have inherited some other property that I plan to sell. Do you think the bank will take he entire money back .
vispy.doctor:045748 : sudipto- banks have taken their avg cost of deposits in 2009 and added some mark up for cost of operations etc..
vispy.doctor:045839 : Yuvraaj- You can repay when you want. most banks have a 6 mth lockin.
Karan Chadha:045825 : The ICICI Bank Base Rate (I-Base) has been fixed at 7.50%. for new customers. How will it help the common man
vispy.doctor:050126 : Karan- BR makes the loan pricing more transparent. Also earlier large players being subsidized at cost of smaller/ maybe even retail customers. Now that may not happen.
Alok:050101 : Can I shift my interest rate if I request the bank to do that or will I be charged on the rate that was decided earlier. Can the Bank can revised my interest rate according to the Base Rate and if it can , when will the new rate will be applicable.
vispy.doctor:050327 : alok- i suggest you dont make any change. any shift will attract a fee. let loan continue at present rate.
Karan Chadha:050227 : Thank you Mr Vispy
yogita.khatri:050158 : Great to have you on live chat session, Mr. Doctor.. Thank you for joining us.
vispy.doctor:050422 : thanks Karan..
yogita.khatri:050418 : Thank you all for participating in the live chat. We welcome you all to our future chat sessions.
vispy.doctor:050455 : My pleasure Yogita. Thanks for joining inThat is the end of the chat session for today.
Thank you all for logging in.
Till then its bye from us.