State Bank of India hiked its marginal cost of funds-based lending rate (MCLR) by 5-10 basis points across selected tenures. This move is set to have a direct impact on borrowers, potentially leading to an increase in the equated monthly instalments (EMIs) for various loans, including home and auto loans.
The decision to raise the MCLR follows the recent stance of the monetary policy committee (MPC), chaired by RBI Governor Shaktikanta Das, maintaining the repo rate at 6.5% for the fifth consecutive time since December 8, 2023.
With this adjustment, borrowers in the process of applying for new loans will be subject to increased lending rates. Additionally, existing borrowers will experience higher EMIs on their loans, taking into account the reset period associated with MCLR-based loans.
Effective immediately, the revised MCLR rates unveiled by SBI are as follows: 8.20% for a 1-month tenure, 8.20% for a 3-month tenure, 8.55% for a 6-month tenure, 8.65% for a 1-year tenure, 8.75% for a 2-year tenure, and 8.85% for a 3-year tenure. However, the overnight tenure remains steady at 8.00%.
This increase in rates underscores the evolving dynamics of the lending landscape, impacting the affordability of borrowing for consumers and potentially affecting their financial planning.
Also Watch: RBI Monetary Policy December 2023: Repo rate left unchanged at 6.5% for the fifth time