RBI's mandate for banks to link retail loans with external benchmark should put peer pressure on HFCs: The Reserve Bank of India (RBI) has mandated all banks to link all new incremental floating-rate loans for personal, retail and MSMEs to external benchmarks like repo from October 01, 2019, a move to ensure smooth transformation of policy rate cuts. Though there are four external benchmark rates offered to banks, we base our analysis on repo-linked products, given that SBI has already introduced such products. Although such a mandate has not been issued for HFCs, the peer pressure to maintain their market share would push HFCs to cut down the lending rates. (exhibit 11)...