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Loan on Floating Interest Rate and Fixed Interest Rate Difference

difference between floating and fixed interest rate

What is a Floating Interest Rate?

A floating interest rate, also known as a variable or adjustable rate, changes over time based on the base rate set by the bank or financial institution, which is linked to a benchmark (like the RBI repo rate).

✔️ Key Features of Floating Interest Rate Loans:

  • Rate changes as per market conditions.

  • EMIs may increase or decrease.

  • Can benefit from falling interest rates.

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