Mumbai: Your wait for a significant reduction in equated monthly instalments (EMIs) on your home or car loans may take more time. Some banks have begun reducing their lending rates albeit marginally despite the RBI cutting its key policy rate by 25 basis points last month.
On Tuesday, State Bank of India announced a cut in its marginal cost of funds-based lending rate (MCLR) by 5 bps across all tenors effective July 10.
The benchmark one-year MCLR rate to which most consumer loans such as home, auto and personal loan rates are linked stands reduced from 8.45 per cent to 8.40 per cent per annum. SBI commands 35 per cent market share in home loans and auto loans.
On July 1, ICICI Bank, had cut its MCLR by 10 bps across tenors. ICICI’s one-year MCLR now stands at 8.65 per cent.
Bank of Baroda too announced a token rate cut by reducing its MCLR by 5 to 10 basis points.