This refers to ‘Banks hike spread on repo-linked loans’ (April 15). While repo-linked lending promises transparent and faster transmission, an absolute and uniform reduction in lending rates is difficult in practice. Well-rated, high-value borrowers often negotiate the finest rates irrespective of market direction, and banks are compelled to concede due to competitive pressures. This creates an asymmetry: when rates soften, banks must reduce pricing for such borrowers; but when rates harden, upward revision becomes difficult for fear of losing business. At the same time, deposit mobilisation does not keep pace without higher rates, putting pressure on margins.

In this backdrop, increasing spreads is less a distortion and more a survival response. The broader concern is that sustained margin pressure may push banks towards fee-based income, sometimes leading to mis-selling of third-party products.

J Kumar

Srirangam, Trichy

BRICS should step up

This refers to ‘Iran war, a boon for the BRICS’ (April 15). The common perception is that the West Asia affairs are not getting the attention they deserve from those in charge of governance and diplomacy at the highest level.

The suggestion that BRICS can play a more proactive role in the West Asia affairs has to be welcomed. If international organisations like the UN have largely been silent, regional organisations like the European Union and BRICS need to rise to the occasion and coordinate with nations in the affected regions and help out the people affected by the chaos. In the present situation, India and China have to play a more proactive role, going beyond protecting self-interest.

MG Warrier

Mumbai

Improving cyber security

With reference to ‘Cyber insecurity’ (April 15), the measures suggested by the banking regulator in controlling digital frauds are vital, since many Indians with their poor financial and digital literacy are by default becoming first-time users of digital interfaces and are susceptible to digital frauds committed by vested interests, misusing the technological inadequacies. The unpredictability centred around recovery of defrauded funds pose a big challenge leading to loss of trust in the system. Creation of more dedicated cybercrime cells would improve public confidence.

Sitaram Popuri

Bengaluru

Published on April 15, 2026