New Delhi: The spiraling inflation has dampened the spirit of middle class which desires to fulfill many of its dreams through loans. The rising interest rates have not only shattered its plans of purchasing a house through home loan but have also given a blow to its hopes of providing higher studies for bright future of children through education loan.

During the past one-and-a-half-year, the efforts of Reserve Bank of India to curb inflation have proved to be a damp squib. The key interest rates have been raised from 5.26 percent to 8.25 percent affecting home, education, vehicle and personal loans.

While there has been about 2 percent rise in interest on home loans, the vehicle loan has also witnessed the similar hike.

The education loan which helped middle class citizens to provide better higher education to their children has also been on a losing stride. Until last year, the interest rate on education loan was 12.5 percent on upto Rs 7.5 lakh but the recent hike on Friday has made it 14.25 percent.

The status of personal loans also relates a similar tale with rising interest rates. Though acquiring a loan from a public bank is marginally cheaper, its interest rates have also touched 18.50 percent mark.

(JPN/Bureau)