SBI's loan EMI set to rise as lender hikes MCLR by 10 bps — Check latest interest rates

This decision comes in the wake of Reserve Bank of India (RBI) increasing benchmark policy rates to tame headline inflation. Since May, the RBI has increased the repo rate by 225 basis points to 6.25 percent. The first hike was to the tune of 40 bps in May and then 50 basis points in June. It again raised the repo rate by 50 bps in August and then again by 50 bps in September. Considering another hike of 35 bps in December, the total rise comes to 225 bps.

Generally, when RBI hikes the repo rate, it increases the cost of funds for banks. This means that banks will have to pay more for the money they borrow from RBI. Consequently, banks pass on the cost to borrowers by increasing their loan interest rates, making EMIs costlier.

As a result, both new and existing borrowers witness an increase in their loan interest rates.

Meanwhile, SBI currently offers a certain concession on home loans under its festive offer campaign which is scheduled to end on January 31, 202. Under this, the bank is offering a concession ranging from 15 bps to 30 bps in various home loan categories as part of this festive offer. It should be noted that SBI's home loan rates are determined by a borrower's CIBIL score. The lower the interest rate on home loans, the higher your credit score.

Home loan rates from SBI are being reduced by 15 basis points (bps) for borrowers with CIBIL scores of at least 800, bringing the rate down from 8.90 percent to 8.75 percent. For credit scores between 750 and 799, home loan rates see a reduction to 8.75 percent from 9 percent.  Additionally, home loans have a concession of 20 basis points to 8.90 percent from their standard rate of 9.10 percent for credit scores of 700 to 749.