People with expensive loans are hoping for relief, but the Reserve Bank of India (RBI) has disappointed them by not reducing the repo rate.
This news was a letdown, especially for those struggling with high-interest loans.
The situation worsened when HDFC Bank, one of the largest private sector banks, decided to increase its loan interest rates.
HDFC Bank Raises Interest Rates
HDFC Bank has made loans more expensive by changing its Marginal Cost of Lending Rates (MCLR).
Starting from September 7, 2024, the MCLR rates have been increased by 5 basis points across different loan tenures.
This adjustment means that the interest rates on loans have risen.
For a three-month loan, the interest rate has gone up from 9.25% to 9.30%.
For a six-month loan, the rate is now 9.30%, and for a one-year or two-year loan, it is 9.45%.
These changes will affect people with home loans, car loans, and education loans, leading to higher monthly payments (EMIs) and more interest overall.
Wider Impact on Loan Holders
The increase in loan rates by HDFC Bank adds to the financial burden for borrowers.
This trend is not limited to HDFC; other major banks like the State Bank of India (SBI), Canara Bank, UCO Bank,
and Bank of Baroda have also raised their loan interest rates recently. As a result, loan holders across the country will face higher costs for their loans.
