Does repo rate affect personal loan?

Repo rate means the rate at which the Central Bank of a country provides credit to commercial banks against collateral. In India, RBI cuts or increases the repo rate according to the inflation prevailing in the economy. A cut in the Repo rate will lower the cost of borrowing for commercial banks as well as for individuals.

So, if you apply for personal loans during lower repo rates, you can enjoy economic interest rates. Thus, you have to pay less interest as a personal loan becomes cheaper. But if RBI increases the repo rate, the personal loan becomes expensive.