LIC Housing Finance has reduced its rate of interest on new home loans by 50 basis points, in line with the similar degree of repo rate cut by the Reserve Bank of India (RBI).

With this revision, interest rates on new home loan sanctions will now start from 7.50 per cent, effective June 19, 2025, coinciding with the company's 36th Foundation Day, it said in a statement Saturday.

This move by LIC Housing Finance is aimed at passing on the benefit to new home loan customers to encourage home ownership and improve affordability.

The recent frontloaded repo rate cut by the RBI was understandably aimed at boosting economy, which has relatively moderated. The policy rate cut and the subsequent decline in interest rates by banks will create demand for fresh credit, giving fresh life to the economy. After a total of 100 basis point repo rate reduction since February 2025, the scope for more rate cuts is limited, RBI Governor Sanjay Malhotra had hinted after the latest monetary policy meeting.

Tribhuwan Adhikari, MD and CEO, LIC Housing Finance said "As we mark our 36th Foundation Day, we remain committed to making home ownership more accessible. The rate cut is a continuation of our effort to align with RBI's policy direction and pass on the benefits to our customers."

"We are confident this move will provide an added boost to housing demand, especially in the affordable and mid-income segments, where aspirations of owning a home are closely tied to interest rate dynamics," the MD and CEO added.

LIC Housing Finance Ltd is a leading housing finance company having networks of offices across India and a representative office in Dubai.

In addition, the Company also distributes its products through branches of its subsidiary LIC HFL Financial Services Ltd.LIC Housing Finance Ltd was promoted by Life Insurance Corporation in 1989, and a public issue was made in 1994.

Published on June 21, 2025