New Delhi: Reserve Bank of India governor Dr Bimal Jalan has said the real interest rates have been on the higher side. The interest rates are soft; it will be softer.
![](bimal_jalan.jpg)
While justifying the Union Budget proposal of a 0.5-per cent cut in small savings, Jalan said: The real interest rates at which corporates borrow funds from banks and financial institutions are still higher if compared to their prime lending rates.
Consumers have to pay a higher interest of 12.5 per cent for housing and consumer loans, he said. This is despite the fact that the government has been able to go in for 10-year-borrowings at 7.5 per cent.