New Delhi:
On December 15, the State Bank of India (SBI) announced a marginal cost of funds-based lending rate (MCLR) hike by 5-10 basis points on select tenures.
This move is expected to impact borrowers as it raises the cost of consumer loans, including home and auto loans.
The decision to increase rates follows the recent decision by the RBI’s monetary policy committee to maintain the repo rate at 6.5% for the fifth consecutive time.
Impact on Borrowers
With the rise in MCLR, equated monthly installments (EMIs) on loans are set to become more expensive.
Both new loan applicants and existing borrowers will be affected by the increased rates.
While new applicants will have to accept loans at the elevated rates, existing borrowers will see a rise in their future installment amounts.
It’s crucial to note that MCLR-based loans have a reset period, during which the rates are revised for the borrower.
Revised MCLR Rates
Here is an overview of the revised MCLR rates at SBI:
| Tenor | Existing MCLR (%) | Revised MCLR (%) |
|---|---|---|
| Overnight | 8.00% | 8.00% |
| One Month | 8.15% | 8.20% |
| Three Month | 8.15% | 8.20% |
| Six Month | 8.45% | 8.55% |
| One Year | 8.55% | 8.65% |
| Two Years | 8.65% | 8.75% |
| Three Years | 8.75% | 8.85% |
(Source: SBI bank website)
The new rates, effective immediately, indicate changes across various tenures, with the overnight tenure remaining unchanged at 8.00%.
