PFC and REC, Navratna CPSEs under Ministry of Power, are the prime financiers of Indian Power Sector capturing a significant market share in financing Indian Power Sector. PFC and REC as group companies have been aligning operations to realise synergies. As a part of such effort, PFC and REC have now decided together to reduce lending rates upto 2%. This initiative was undertaken to offer competitive rates, in line with the rates being offered by peers in the market. This will also help PFC and REC to continue their business growth going forward in addition to maintaining reasonable spreads.
The reduction in lending rates will help both PFC and REC to offer lower rates to Power Utilities, which will reduce their borrowing costs thereby reducing their interest payments and in turn benefitting the end consumer in terms of lower tariff.