Mumbai, Aug. 20: The State Bank of India (SBI) today sought RBI's permission to re-introduce teaser loans to push demand and revive the economy.

"I am told that real estate stock is at a two-year high and I was thinking if it is possible for a little while... Could something of this (teaser loan) kind be allowed given the fact that this is one of the portfolio where NPAs are the lowest," SBI chairperson Arundhati Bhattacharya told RBI governor Raghuram Rajan at the conference.

The SBI is keen to introduce home loans below the base rate for a limited period, betting on the lower rates to attract more buyers, leading to an uptick in demand and eventually a recovery of the economy.

The SBI's base rate, the minimum lending rate and to which floating rates are linked, is 9.70 per cent.

Bhattacharya said the SBI's teaser loans were able to revive demand after the economic crisis in 2008.

The SBI then had offered home loans at a lower interest rate of 8 per cent compared with market rates of over 9 per cent for a limited period.

The product, however, did not find favour with the central bank as it felt such loans misled people who might fail to realise that the rates would rise after the first few years. The SBI finally had to scrap the loans in 2011.

Rajan said he would look into the proposal if real estate developers, who were sitting on unsold stocks, brought down their prices.