HDFC Bank has cut its marginal cost of funds-based lending rate on select tenures by upto 5 basis points. After the change, MCLR will now range between 9.15 percent and 9.45 percent.
The new rates will come into force from Jan 7, 2025 onwards.
What is MCLR?
MCLR refers to the marginal cost of funds-based lending rates below which lenders are not permitted to lend. In 2016, the Reserve Bank of India (RBI) replaced the base rate system with the MCLR based lending rates. However, those borrowers who had taken loans before 2016 are still governed by the base rate or benchmark prime lending rates (BPLR) as the case may be.
The BPLR was introduced in 2003 before being phased out in 2010 by the base rate. The current interest rate regime is dictated by the MCLR which – as mentioned above – was rolled out in April 2016. HDFC Bank charges 17.95 percent as Benchmark PLR and 9.45 percent as base rate with effect from Sept 9.
When MCLR rates are raised, loan EMIs also typically go higher. Since MCLR rates are more dynamic, any change in these rates lead to tweaks in the interest rates, thus impacting the loan EMIs.
Other lending rates
The other lending rates charged by the largest private bank are as follows: The Benchmark PLR (BPLR) of HDFC Bank was revised to 17.95 per cent p.a on September 9, 2024.
The revised ‘base rate’ is 9.45 per cent, which also came into force on Sep 9, 2024.
The other lending rates charged by the largest private bank are as follows: The Benchmark PLR (BPLR) of HDFC Bank was revised to 17.95 per cent p.a on September 9, 2024.
The revised ‘base rate’ is 9.45 per cent, which also came into force on Sep 9, 2024.
