SBI Raises Interest Rates: SBI and Other Banks Increase MCLR: What Borrowers Need to Know
The State Bank of India (SBI), a major player in the domestic banking sector, has surprised borrowers by raising its Marginal Cost of Funds-Based Lending Rate (MCLR) by 10 basis points. This increase will make vehicle and home loan repayments more burdensome.
Increase in MCLR by 10 Basis Points
The State Bank of India (SBI) has announced a 10 basis points increase in its Marginal Cost of Funds-Based Lending Rate (MCLR), impacting vehicle and home loans.
Effective from Saturday, the one-year MCLR rate has been revised from 8.65% to 8.75%. Vehicle loans with a one-year tenure and personal loans with a two-year tenure will now fall between 8.10% and 8.95%.
Revised Rates on Fixed Deposits
SBI has also adjusted interest rates on fixed deposits. Previously, the bank had increased rates on deposits below ₹2 crore and now has revised rates for deposits below ₹3 crore by up to 75 basis points.
Interest on deposits ranging from 7 to 45 days has been raised from 3.5% to 4%, and for 46 to 179 days from 5.5% to 6%. For deposits of 180 to 210 days, the rate is now 6.75%. For 211 days to less than a year, the rate has been revised to 7% from 6.5%.
Term deposits from one to two years will now earn 7.3%, up from 6.8%. Deposits from two to three years will see a new rate of 7.5%, while three to five-year deposits will earn 7.25%, up from 6.75%. For five to ten-year deposits, the rate has been increased to 7.50%.
Other Banks Follow Suit
Along with SBI, five other banks have revised their MCLR rates: HDFC Bank, Yes Bank, Canara Bank, PNB, and IDBI Bank. HDFC Bank increased its MCLR by 5 basis points, bringing loan interest rates to a range of 9% to 9.35%.
Yes Bank’s MCLR now ranges from 9.25% to 10.60%, while Canara Bank’s rates are between 8.15% and 9.30%. PNB’s rates are from 8.25% to 9.10%, and IDBI Bank’s rates range from 8.35% to 10%.
MCLR Trends
One-day loan MCLR increased from 8% to 8.10%
One-month and three-month loan rates increased from 8.20% to 8.30%
Six-month loan MCLR raised from 8.45% to 8.55%
One-year loan MCLR revised from 8.55% to 8.65%
Two-year loan rates increased from 8.75% to 8.85%
Three-year loan MCLR increased from 8.85% to 8.95%
The base rate for the bank is now set at 10.40%.
Understanding MCLR
The Marginal Cost of Funds-Based Lending Rate (MCLR) is the minimum interest rate below which banks are not permitted to lend, ensuring transparency and uniformity in the lending process.
Disclaimer: Check the official website for more accuracy.