RBI’s move of revising the repo rate post Monetary Policy Committee (MPC’s) meeting was bound to have a ripple effect on the lending rates of banks like HDFC Bank, Bank of India and others.
The Reserve Bank of India (RBI’s) recent decision to hike repo rate by 35 basis points (bps) has not come as a surprise for the industry at large. As the revised repo rate comes to 6.25 per cent, several leading banks like Bank of India, HDFC Bank etc., have also revised their lending rates.
RBI’s move of revising the repo rate post Monetary Policy Committee (MPC’s) meeting was bound to have a ripple effect on the lending rates of banks. Since the hike in the banks’ lending rates would make EMI’s costly, most banks have started displaying the revised rates on their websites as well.
As per a PTI report, state-owned Bank of India’s lending rate, one after revision has now been posted on the official website. It posted, as per the report that the effective Repo Based Lending Rate (RBLR) with effect from December 7 is 9.10 per cent as per the revised repo rate (6.25 per cent).
The report adds that even private sector lender HDFC Bank has hiked its marginal cost of funds-based lending rate (MCLR) effective Wednesday, when RBI hiked repo rate. HDFC Bank’s website also posted that the one-year MCLR, which acts as a benchmark for many consumer loans, has increased by 50 bps to 8.60 per cent.
Since Bank of India and HDFC Bank have posted their revised rates, other banks too, are expected to follow this soon. Another major lender ICICI Bank already revised its MCLR with effect December 1. With this revision, the one year benchmark rate was raised by 50 bps to 8.40 per cent from 7.90 per cent earlier, as per the PTI report.