What is an External Benchmark?

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Direct Answer
An External Benchmark is an independent reference rate (such as the RBI Repo Rate or T-Bill yields) that banks do not control, guaranteeing pricing transparency for vulnerable borrower segments
Loan Category (Commercial Banks) Mandatory Benchmark Linkage
Floating-Rate Personal Loans External Benchmark
Floating-Rate MSME Loans External Benchmark
Other Categories External Benchmark at the bank’s discretion