Equated Monthly Instalments (EMIs) for home, car and personal loans are set to go up for existing borrowers, with State Bank of India (SBI) and other major lenders including Bank of Baroda (BoB), Axis Bank and Kotak Mahindra Bank increasing their benchmark lending rates by up to 0.10 per cent. The lending rate hike by these banks -- which comes after a gap of around three years -- is likely to be followed by others, which will push up the EMIs for different categories of loans to consumers.
The country's largest lender SBI has revised its marginal cost of funding based lending rate (MCLR) by 0.10 per cent across tenors. The bank revised the lending rate from 7 per cent to 7.10 per cent for the one-year tenure. The revised MCLR is effective from April 15, as per information posted on SBI's website.
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The overnight, one-month and three-month MCLRs also rose by 10 basis points (bps) to 6.75 per cent, whereas the six-month MCLR increased to 7.05 per cent. The two-year MCLR increased by 0.1 per cent to 7.30 per cent, and the three-year MCLR rose to 7.40 per cent, as per SBI's new rate chart.
Bank of Baroda (BoB), Axis Bank and Kotak Mahindra Bank have also hiked the benchmark one-year MCLR -- against which most of the consumer loans are priced -- by 0.05 per cent each. State-owned BoB's new MCLR for one year tenure stands at 7.35 per cent with effect from April 12, 2022. Private sector Axis Bank and Kotak Mahindra Bank have revised the one-year MCLR to 7.40 per cent with effect from April 18 and April 16, respectively.
EMIs linked to the MCLR would see a slight increase, but loans taken against other benchmarks like EBLR and RLLR will continue to be static. SBI's EBLR (external benchmark based lending rate) rate is 6.65 per cent, while the repo-linked lending rate (RLLR) is 6.25 per cent, effective April 1.
