The State Bank of India (SBI,) on the 9th of September, announced a reduction in the marginal cost of funds based lending rate (MCLR) and interest for home loans.
The SBI will implement the new rates from the 10th of September. According to the announcement, the SBI reduced the rates by 10 basis points in the current fiscal year.
According to sources, the MCLR rates are decided by the Bank based on its own cost of funds. As of now, the MCLR rate is 8.25 %, but from the 10th of September, it will be 8.15 %.
The reason for cutting down the MCLR is the “falling interest rate scenario and surplus liquidity.”
The SBI has a network of over 22,000 branches, which is why it is also the largest commercial bank in India. This move will help in boosting the economy and attracting customers.
The new rates may not be applicable for those who already have home loans and may benefit new borrowers.
After the SBI slashed the MCLR, it is expected other banks may do the same.
Stay tuned for further updates.