Chennai: State Bank of India has come up with a new changes in Marginal Cost of Lending Rate (MCLR) by 10 basis points (bps) for all loan tenors.
It is categorized as one basis point equivalent to one-hundredth part of a percentage point. The hike has come into effect from 15 April 2022.
According to SBI, the hike will be implemented for all loan tenors, this would increase EMIs of home loans, cars and other related loans for existing and future borrowers.
Tenor-wise MCLR effective from April 15: (Existing rate/ new rate)
Over night: 6.65 per cent / 6.75 per cent
One month: 6.65 per cent/ 6.75 per cent
Three months: 6.65 per cent/ 6.75 per cent
Six months: 6.95 per cent / 7.05 per cent
One year: 7.00 per cent/ 7.10 per cent
Two years: 7.20 per cent / 7.30 per cent
Three years: 7.30 per cent/ 7.40 per cent
Bank of Baroda (BoB) has also announced the hike of a Marginal Cost of Lending Rate (MCLR), BoB lending rates based by 5 bps for all loan tenors. BoB's MLCR is now 7.35 per cent which effect from April 12, 2022.
What is MCLR?
MCLR also known as Marginal Cost of Lending Rate, decides the minimum interest rate of all loan tenors. The Interest rate, introduced by RBI in 2016, is used by all banking and non-banking institutions.
The RBI maintained the policy rates unchanged at its monetary policy meeting (MPC) on April 8. As the State Bank of India (SBI) MCLR hike announcement comes days after the RBI kept the repo rate unchanged at 4 per cent in its MPC meet.