Loans to be cheaper as SBI slashes rate
Posted on: 02/Jan/2017 10:20:02 AM
State Bank of India has reduced the interest rate by 0.9 percent for its loans. Prime Minister Narendra Modi on Saturday, appealed to banks to keep the poor, the lower middle-class, and the middle-class the focus of their activities. According to a statement issued by the SBI, its one-year marginal cost of funds based lending rate (MCLR) would be 8 per cent as compared with 8.9 per cent earlier. Home and auto loans of most banks, including SBI, are linked to their respective one-year MCLRs.
The rate cut will be applicable to all fresh loans. The effective interest rate for new home loans is likely to be between 8.25 per cent and 8.5 per cent.
IDBI bank will charge 9.15 percent on one-year loans against the current rate of 9.30 percent. Punjab National Bank (PNB) has reduced its overnight marginal cost of funds based lending rate (MCLR) to 8.20 per cent with effect from January 1.
