HDFC Bank—the largest private-sector bank in India—has reduced its Marginal Cost of Funds–Based Lending Rate (MCLR) by 0.05% (5 basis points) across all tenures except the two‑year period, effective 7 August 2025 The Economic Times.
Here’s how the new rates compare:
| Tenure | Old MCLR (Jul 2025) | New MCLR (Aug 2025) |
|---|---|---|
| Overnight | 8.60% | 8.55% |
| 1 Month | 8.60% | 8.55% |
| 3 Months | 8.65% | 8.60% |
| 6 Months | 8.75% | 8.70% |
| 1 Year | 8.75% | 8.70% |
| 2 Years | 8.75% | 8.75% (unchanged) |
| 3 Years | 8.80% | 8.75% |
These changes mean lower EMIs for customers holding floating‑rate home loans, car loans, personal loans, etc., since such rates are tied to MCLR.
Importantly, even though the RBI hasn’t changed its repo rate, HDFC has made these adjustments on its own to benefit borrowers The Economic TimesThe Economic Times.
Why This Matters for Borrowers
Direct Impact on Loans: Any loan linked to MCLR—like home, car, or personal loans—now has a lower benchmark, which can reduce monthly EMI amounts.
Bank’s Singapore: This rate cut illustrates HDFC Bank’s willingness to pass on reduced borrowing costs independently, without waiting for RBI policy changes.
Understanding MCLR: MCLR is the minimum interest rate at which a bank can lend, based on its funding costs, operational cost, and cash reserve ratio.
When it goes down, borrowers benefit; when it goes up, EMIs rise The Economic TimesBankBazaar.
