Money & Banking

Union Bank cuts MCLR by 5 basis points

Our Bureau Mumbai | Updated on September 11, 2020

The one-year MCLR now stands at 7.20%

Union Bank of India has pared its Marginal Cost of Funds-based Lending rate (MCLR) by 5 basis points across all tenors with effect from September 11.

The public sector bank, in a statement, said this is its 15th consecutive rate cut since July 2019.

One-year MCLR now stands at 7.20 per cent, down from 7.25 per cent.

All rupee loans sanctioned and credit limits renewed with effect from April 1, 2016 have been priced with reference to the MCLR which is be the internal benchmark for such purposes.

The central bank, in a bid to strengthen monetary transmission, asked all banks to offer new floating rate personal or retail loans (housing, auto, etc.) and floating rate loans to Micro and Small Enterprises (MSEs), linked to external benchmarks such as the policy repo rate, with effect from October 1, 2019.

With a view to further strengthening monetary policy transmission, the RBI directed banks to link all new floating rate loans to the medium enterprises to the external benchmarks with effect from April 1.

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Published on September 11, 2020
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