The Reserve Bank of India raised the repo rate by 0.25 percentage points to 5.50% on 7 October 2026, its first increase since February 2023. Vehicle loan rates can follow, so compare finance offers as carefully as the vehicle price. Any Shiva Group showroom can give you a finance comparison before you buy.
What RBI decided.
Repo rate: raised from 5.25% to 5.50%.
Stance: changed from neutral to calibrated tightening.
Outlook: the Monetary Policy Committee said rate cuts are off the table in the near term.
Next meeting: 2 to 4 December 2026.
What it means for your loan.
Banks decide how much of a repo change to pass on, and when. Floating-rate loans linked to an external benchmark such as the repo rate reset at their next review date. Many vehicle loans carry a fixed rate, and a fixed EMI does not change. If you are about to buy, ask each lender whether the rate is fixed or floating.
How much difference does 0.25% make?
As an illustration only: on a ₹10 lakh loan over five years, a rate rise from 9.00% to 9.25% takes the EMI from about ₹20,758 to about ₹20,880. That is about ₹122 more a month, or about ₹7,290 over the loan. These rates are examples, not quotes from any bank.
How to keep your EMI in check.
Compare at least two lenders: look at the interest rate, processing fee and prepayment charges together.
Ask fixed or floating: a fixed rate protects you if rates rise again.
Get the total cost in writing: the EMI, the tenure and the total amount you will repay.
Consider a larger down payment: a smaller loan means a smaller EMI and less interest.
Finance at Shiva Group.
Shiva Group, the Delhi NCR automotive dealer group, sells and services Bajaj, Chetak, KTM, Triumph, Mahindra, Land Rover, MG Select, Bajaj three-wheelers and Mahindra Commercial vehicles. At its showrooms, finance and exchange values are explained in writing before you commit. Ask for a finance comparison on the vehicle you want. Find a showroom or contact us.
Frequently asked questions.
What is the RBI repo rate now?
5.50%, after a 0.25 percentage point increase on 7 October 2026.
Will my car loan EMI go up?
Only if your loan has a floating rate that your lender raises. Fixed-rate EMIs do not change. Ask your lender.
When does RBI meet next?
The Monetary Policy Committee’s next meeting is scheduled for 2 to 4 December 2026.
Can I compare loan offers at a Shiva Group showroom?
Yes. Ask the showroom for a finance comparison on the vehicle you want, with the terms in writing.
Sources.
SCC Online, 9 October 2026: RBI hikes repo rate to 5.50%
Motilal Oswal, October 2026: RBI raises rate by 0.25 percent
About Shiva Group
Shiva Group is a family-owned automotive retail group with a legacy since 1928 and in automotive retail since 1972. Headquartered in Delhi NCR, the Group is an authorised sales and service partner for nine brands across two-wheelers, cars and SUVs, and commercial vehicles — Bajaj, Chetak, KTM, Triumph, Mahindra, Land Rover, MG Select, Bajaj Three-Wheelers and Mahindra Commercial — with a network across Delhi NCR and North India.
