HDFC Bank has revised its interest rates based on the marginal cost of borrowing (MCLR) with effect from Saturday, i.e. September 7. Now, the MCLR-based lending rates will be in the range of 9.10 to 9.45 per cent per annum.
However, only the MCLR for three-month tenors has been increased by 5 basis points. The rates for all other tenors remain the same. As shown in the table below, the overnight MCLR rate is 9.10 percent and the one-month MCLR rate is 9.15 percent per annum.
The three-month MCLR rate has been increased from 9.25 percent to 9.30 percent. The six-month MCLR is 9.40 percent. For all long tenures, the MCLR rate is 9.45 percent, which shows that HDFC Bank website.
MCLR helps banks determine their interest rates for various types of loans such as home loans, business loans, and personal loans, among others.
(Fountain: hdfcbank.com; Rates effective from 7 September 2024)
What is MCLR?
MCLR stands for marginal cost of funds based lending rates below which banks are not allowed to lend. In 2016, Reserve Bank of India (RBI) replaced the base rate system with MCLR-based lending rates. However, those borrowers who had taken loans before 2016 are still governed by the base rate or prime reference interest rates (BPLR), as the case may be.
The BPLR was introduced in 2003, before being phased out in 2010 in favour of the base rate. The current interest rate regime is determined by the MCLR which, as mentioned above, was launched in April 2016.
When MCLR rates increase, your Loan EMI They also increase. Since MCLR rates are more dynamic, any change in these rates leads to an adjustment in interest rates, which affects monthly loan installments.
It is noteworthy that the current base rate of HDFC Bank is 9.40 per cent, which came into effect from June 18 this year, reveals the official website of the bank.
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