Your EMIs for HDFC Bank loans will soon go down

Your EMIs for HDFC Bank loans will soon go down

HDFC Bank has announced a reduction in its Marginal Cost of Funds-based Lending Rates (MCLR) for select tenures.

The cut, which goes up to five basis points (bps), will benefit borrowers whose loans are linked to this regime.

The revised rates come into effect from today, according to information available on the bank's official website.

What is MCLR?

The MCLR is the minimum interest rate a bank must charge for a loan. It serves as a benchmark for determining the lower limit of interest rates on loans. The Reserve Bank of India (RBI) introduced this system in 2016.

Change will directly affect the EMIs of borrowers

The new MCLR rates set by HDFC Bank range between 8.10% and 8.55%, depending on the loan tenure. Previously, these rates were between 8.15% and 8.55%.

The bank has revised its MCLR for select short-term tenures ,while keeping most medium and long-term rates unchanged.

This change will directly affect the EMIs of borrowers whose loans are linked to these revised MCLR rates.

Here are the revised rates

The revised MCLR rates are as follows:

Overnight and one-month MCLRs have been lowered from 8.15% to 8.10% each, while the three-month MCLR has been reduced from 8.25% to 8.20%.

However, the six-month, one-year, two-year, and three-year MCLR rates are unchanged at 8.35%, 8.35%, 8.45%, and 8.55%, respectively.

This selective revision is aimed at providing relief to borrowers in specific loan categories while maintaining stability in others.