In view of the ample liquidity and ongoing festival season, public sector banks have started cutting repo rate-linked lending rates and marginal cost of funds-based lending rates. Central Bank of India said on Thursday that it has reduced repo-based lending rate (RBLR) by 25 basis points with effect from October 10. One basis point equals one-hundredth of a percentage point.
Accordingly, interest rate on housing loans (low-risk category) stands reduced from 8.25 per cent to 8 per cent and for micro and small enterprise (MSE) loans it stands reduced to 8.95-9.50 per cent from 9.20-9.75 per cent.
Bank of India has reduced its overnight marginal cost of funds-based lending rate (MCLR) by 15 bps to 7.95 per cent and one-year MCLR by 5 bps to 8.30 per cent with effect from October 10. “This reduction transmits the change made in RBI policy rate (repo rate) on October 4,” the bank said in a statement.
Indian Overseas Bank has reduced the interest rate for the retail segment (housing, vehicle, education and clean loans) and micro and small enterprises (MSEs) by 25 bps, revising the repo-linked lending rate (RLLR) to 8 per cent from 8.25 per cent with effect from November 1.
SBI has reduced its MCLR by 10 bps across all tenors with effect from October 10.