Though the RBI has called for a 50BPs cut, no bank has actually followed it. IDBI Bank, Punjab National Bank, ICICI Bank and Syndicate Bank have announced a 25 BPs cut in the Base Rate. However, HDFC Bank and Kotak Mahindra Bank are yet to announce the rate cut. Still, the 25 BPs cut does not help the common man much with their budget. If the banks go for a 50 BPs cut, there might be concrete reason for us to celebrate.

Sumit Bali, Executive Vice-President, Kotak Mahindra Bank, says, "The liquidity situation is very tight so RBI's 50 BPs rate cut will not mean a similar cut by banks unless deposit rates fall." He says that a borrower will witness only a drop of 200-250 in installments, for a loan of 10 lakh for 3 years. So, the person will save 7,000-9,000 for the total period. However, as most car loans do not go over 3-4 lakh, this does not spell great savings for the common man.