HDFC Bank, the country’s largest private sector bank, hiked its marginal-cost based lending rate (MCLR) on loans for all tenors by 25 basis points (bps). The hike in HDFC Bank’s lending rate will make EMIs on home and other loans tied to its marginal cost of funds based lending rate dearer.
According to the HDFC Bank website after the latest rate reduction, its overnight MCLR stands at 7.15%, while one-month MCLR is 7.20%. Three- month and six-month MCLR stand at 7.25 % and 7.35% respectively. One-year MCLR, to which many of the consumer loans are linked, will now be 7.50%, two-year MCLR will now be 7.60%, while three-year MCLR has been set at 7.70%. These new rates are effective 7 May, as per HDFC Bank website.
This will make the home, car, personal and other loans more expensive. Equated monthly installment (EMI) for different categories of loans will go up.
HDFC Bank’s tenor-wise MCLRs effective from 7 May 2022
This comes after, State Bank of India (SBI), Bank of Baroda, Axis Bank and Kotak Mahindra Bank have also announced an increase in their MCLR rates.
Banks have hiked lending rates for the first time in around three years.
In a surprise move on May 4, the Reserve Bank of India (RBI) after an unscheduled MPC meeting hiked the benchmark lending rate by 40 basis points (bps) to 4.40 per cent to contain inflation that has remained stubbornly above the target of 6 per cent for the last three months.