Private lender HDFC Bank has slashed its marginal cost of funds-based lending rate (MCLR) by 5 basis points (bps) across tenors.
The newly announced rate cut will be effective from Monday (June 8), according to its HDFC Bank’s official website.
HDFC Bank stated that its overnight MCLR stands came down to 7.30 percent, while one-month MCLR is 7.35 percent.
One-year MCLR, to which many of the consumer loans are linked, will now be 7.65 percent, while three-year MCLR has been announced at 7.85 percent.
The development comes after similar steps are announced by other banks after two rate cuts by the Reserve Bank of India (RBI) in a bid to help the economic growth rise in the aftermath of the Covid-19 pandemic. The RBI has reduced its key rates by 115 bps since March.
Lenders review their MCLR every month. Recently, some part of the lending has also been synced directly to external benchmarks, such as the repo rate, for improved transmission of policy actions.