HDFC Bank Has announced cut in interest rates. Based on the information provided by the bank, the bank has reduced its Marginal Cost of Funds-Based Lending Rate (MCLR) by up to 5 basis points (BPS) on select tenors. After this cut, HDFC Bank’s MCLR now ranges between 9.15% to 9.45%. The new rates have come into effect from today i.e. January 7, 2025.
EMI of home-personal loan will be less
The reduction in MCLR rates will have a direct impact on the equated monthly installments (EMIs) on old floating rate loans such as home loans, personal loans and business loans which are linked to MCLR. With the reduction in MCLR rates, the EMI on these loans will also reduce. According to the bank, the overnight MCLR has been reduced by 5 bps, from 9.20% to 9.15%. One month MCLR has been kept unchanged at 9.20%, three month MCLR has been kept unchanged at 9.30%. Six month and one year MCLR has been cut by 5 bps from 9.50% to 9.45%. The two-year MCLR has been kept unchanged at 9.45%. The three-year MCLR has been reduced by 5 bps from 9.50% to 9.45%.
What is MCLR?
MCLR is the minimum interest rate that a financial institution charges for a particular loan. This sets the lower limit on the interest rate for the loan. Repo rate cut is expected in the monetary policy meeting of RBI to be held in February. After this the loan will become cheaper. For a long time, common people have been waiting for the increased EMI of home and car loans to reduce.
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