News Patiala: 15th July 2022 State Bank of India (SBI) has decided to increase its Marginal Cost Lending Rate (MCLR) by 10 basis points or 0.10 percent. The new lending rates will come into effect from today, June 15. According to the State Bank of India‘s website, the bank has decided to increase the MCLR from the current 7.40 percent to 7.50 percent for a period of one year.
The MCLR will be increased from 7.35 percent to 7.45 percent for a period of six months. The MCLR will be increased from 7.60 percent to 7.70 percent over a period of two years. At the same time, it will be increased from 7.7 percent to 7.8 percent over a period of three years.
How will the increase in MCLR affect retail borrowers?
An increase in the MCLR means that retail loans for home, car, and personal loans may be higher and will also affect your equal monthly installments (EMIs).
Interest rates on SBI Home Loans and Auto Loans
With the increase in MCLR, interest rates on SBI home loans can vary from 7.05% to 7.55% depending on your CIBIL score. SBI Auto Loans can vary from 7.45% to 8.15%.
What is MCLR?
MCLR is the minimum lending rate below which banks are not allowed to lend. Banks revise their MCLR rate every month based on market conditions. The MCLR varies from one night to three years. It is based on the marginal cost of the fund, operating costs, cash reserve ratio (CRR), and tenure premium.
Other banks have also raised MCLR rates in July
Bank of Baroda has increased the benchmark marginal cost of funds by 10-15 basis points on the basis of the Fixed Tenure Lending Rate (MCLR). The new rates are effective from July 12. At the same time, private lender IDFC First Bank has also increased the benchmark lending rate by 10 to 15 basis points over different periods. The new rates of the Fund’s Marginal Cost Based Lending Rate (MCLR) have come into effect from July 8, 2022.