First of all I congratulate the author of the article for writing and explaining some of the nitty-gritties of bank system in very clear and easy to understand way.Indeed these have been some terms like repo rate and reverse repo rate which people like me read in newspaper and leave everything on RBI without actually knowing what is happening and why?Still we do not have any control over these matters but now we can surely understand the things.But what I fail to understand is why RBI is making the common man to suffer,who has already taken loans in previous years(say 5 yr. back)by increasing the interests rate.I mean it should be applicable to new loan seekers.Instead banks tend to provide new loans at slightly lower rates than current rates to attract new customers and thus keeping the loan process an attractive one for new loans seekers(esp. for home loans)which in turn increases the loan demand and thus inflation.
