Country’s largest public sector bank State Bank of India (SBI) has increased its marginal cost of funds-based lending rate (MCLR) by 5 basis points (BPS) for three tenors – 3, 6 and 12 months.
This hike in lending rates across these tenors will be effective from today, November 15. With this revision, the MCLR for 3 months and 6 months comes to 8.55% against 8.50% earlier and 8.90% against 8.85%, respectively.
The one-year MCLR stands at 9% now against 8.95% earlier. The MCLRs for other tenors have not been changed. The MCLR for two- and three-year tenure stands at 9.05% and 9.10%, respectively.
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This hike in MCLR will have direct impact on borrowing costs for these tenors. One basis point is equal to one-hundredth of a percentage point.
As per the latest data on lending and deposit rates from the RBI, the one-year median Marginal Cost of Funds-based Lending Rate (MCLR) for scheduled commercial banks (SCBs) remained steady at 8.95% in October 2024, unchanged from September 2024.
SBI auto loans are linked to the bank’s 1-year MCLR, with interest rates varying based on the borrower’s CIBIL score. For SBI personal loans, the interest rate is based on the bank’s 2-year MCLR.
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What is MCLR?
MCLR is a benchmark set by the Reserve Bank of India (RBI) that determines the minimum interest rate at which banks can lend to borrowers. Banks use MCLR to set interest rates on various types of loans, including home loans, personal loans, and business loans.
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