Companies Opt For Bonds Over Bank Loans To Save On Interest Costs

News18 Hindi · india

Following the Reserve Bank of India's recent repo rate hike, banks have increased their lending rates. To avoid these higher costs, large Indian companies are now turning to the bond market to raise funds. Companies with AAA ratings have successfully raised money through bonds at interest rates between 8.13% and 8.85%. This strategy allows them to save significant amounts on interest payments compared to borrowing from banks, where effective rates can be higher due to additional premiums.