The country’s largest lender by assets, State Bank of India recently announced a reduction in its benchmark lending rates across all tenors. The bank said its MCLR or marginal cost of funds-based lending rates will be reduced by 10 basis points which is 0.10 percentage point. The new rates are already effective from October 10. This move marks the sixth consecutive reduction in the key lending rates by SBI this financial year.
Repo rate is the interest rate at which the RBI lends money to commercial banks. MCLR reduction follows a 25 basis points cut in the repo rate by Reserve Bank of India (RBI) last week. SBI has earlier reduced repo rate as the external benchmark for all floating rate loans for micro, small & medium enterprises, housing and retail from October 1. Back in July, the bank had introduced floating rate home loans.
Because of this reduction to 8.05% as against 8.15% before, home loans will get cheaper and benefit home buyers across the country. The reduction of MCLR by 10 basis points across all tenors is particularly beneficial to home buyers. In view of the ongoing festival season and extending the benefits to customers, projects like Risland group’s The Icon at Dhokali in Thane are offering smart living at best prices and some exclusive perks to customers.
The interest rate cutting spree resulting in cheaper loans is news to borrowers, especially home investors and end users. Looks like real estate is set to boost demand this festive season!