New Delhi: The State Bank of India (SBI) has increased its marginal cost of funds-based lending rate (MCLR) by 10 basis points or 0.1 per cent across all tenures. This change will be effective from June 15 which means that borrowers with loans linked to MCLR will see higher EMIs.
Here are the updated MCLR rates effective after the changes:
– One-year MCLR: Increased to 8.75% from 8.65%
– Overnight MCLR: Increased to 8.10% from 8.00%
– One-month and Three-month MCLR: Increased to 8.30% from 8.20%
– Six-month MCLR: Increased to 8.65% from 8.55%
– Two-year MCLR: Increased to 8.85% from 8.75%
– Three-year MCLR: Increased to 8.95% from 8.85%
These adjustments will impact most retail loans, such as home and auto loans, which are typically linked to the one-year MCLR rate. (Also Read: Several Employees Of THIS Bank Fired Over Fake Keyboard Activity And Mouse Jiggling: Details Here)
SBI, on Friday announced that it raised 100 million dollars (About Rs 830 crore) through bonds to boost business expansion. This move coincided with the RBI’s Monetary Policy Committee (MPC) decision to keep the repo rate unchanged at 6.5 per cent due to concerns about rising food inflation. Since October 2019, banks including SBI have been mandated to link new loans to these external benchmarks, which improves the transmission of monetary policy. (Also Read: EPF Withdrawal Update: EPFO Discontinues Covid-19 Advance Facility – Check Details)
What does MCLR represent and when was it introduced?
MCLR is the minimum interest rate that banks cannot lend below, reflecting their borrowing costs. It was introduced in 2016.