Money & Banking

SBI cuts external benchmark rate on loans by 25 basis points

Our Bureau Mumbai | Updated on December 30, 2019 Published on December 30, 2019

State Bank of India (SBI), on Monday, said it will reduce the external benchmark-based rate (EBR) by 25 basis points (bps) from 8.05 per cent to 7.80 per cent from January 1. The EBR-cut comes in the backdrop of ample liquidity in the banking system.

With this reduction, interest rate for existing home loan customers as well as MSME (micro, small and medium enterprise) borrowers who have availed loans linked to EBR, will come down by 25 bps.

For example, floating interest rate home loan for salaried customers for loans up to ₹30 lakh will be available at an interest rate starting from 7.90 per cent (previously at 8.15 per cent) for women borrowers and 7.95 per cent (8.20 per cent for general borrowers).

Last month, the bank had announced reduction in its marginal cost of funds-based lending rate (MCLR) by 5 bps across all tenors.

The one-year MCLR has come down to 8 per cent from 8.05 per cent with effect from November 10. This cut was the seventh consecutive MCLR cut in FY20. The bank had also reduced interest rates on term deposits (TDs) with effect from November 10. Retail TD interest rate was reduced by 15 bps for 1 year to less than 2 years’ tenor from 6.40 per cent to 6.25 per cent. Bulk TD interest rate was reduced by 30 to 75 bps across tenors.

Published on December 30, 2019
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