Higher Home Loan Rates, Auto Insurance And Three Other Changes to Expect In June

It always makes sense to take into account the changes that are afoot in the financial space to ensure your plans do not go astray. There are several changes, effective June, that can affect your life, from paying more for home loans and auto insurance to buying hallmarked gold jewellery, irrespective of the purity.

Here are five key financial and operational modifications you should know about.

Higher SBI Home Loan Interest Rates

If you are a home loan borrower at the State Bank of India, you may pay higher equated monthly instalments (EMIs) from June.

SBI has increased its home loan external benchmark-based lending rate (EBLR) by 40 basis points (bps). One bps is one hundredth of a percentage point. The increase will take effect on June 1, 2022. Previously, SBI’s EBLR was at 6.65 per cent, while the repo-linked lending rate (RLLR) was 6.25 per cent.

EBLR is the sum of the external benchmark rate (EBR) plus the credit risk premium (CRP), according to the SBI website.

SBI earlier announced an increase of 10 bps in its marginal cost-based lending rates (MCLR), effective May 15, 2022.

Axis Bank Increases Minimum Balance Limits

Axis Bank has increased the average monthly balance required for easy savings and salary programmes in semi-urban and rural areas from Rs 15,000 to Rs 25,000. Alternatively, depositors should have a term deposit of Rs 1 lakh. Any shortfall, typically, attracts a penalty. The new minimum balance limit is effective from June 1.

The bank has also raised the limit for its liberty savings account, which is a special account that allows depositors to either maintain the specified balance or spend that much from the account. The limit has been raised from Rs 15,000 to Rs 25,000. This means that account holders either need to maintain a monthly average balance of Rs 25,000 in their accounts or spend that much in a month through the account.

Auto Insurance Rates To Go Up

From June, premium rates for third-party motor insurance for two- and four-wheelers will rise. This policy provides a cover for damage to any third party.

The road transport and highways ministry notified the new rates recently under the Motor Vehicles (Third Party Insurance Base Premium and Liability) Rules, 2022, which will come into force on June 1, 2022.

For cars with engine capacity exceeding 1000 cc, the premium rates have been increased from Rs 2,072 earlier to Rs 2,094, while the premiums for cars between 1000cc and 1500 cc will go up from Rs 3,221 earlier to 3,416. However, for engine capacity above 1500 cc, the premiums will fall from Rs 7,897 from Rs 7,890.

Read here to find out the change in premiums of other vehicle categories—two wheelers and electrc vehicles (EVs).

Gold Hallmarking For All Types of

From June 1, 2022, jewellers can only sell hallmarked gold jewellery in India, irrespective of its purity, the Bureau of Indian Standards (BIS) notified in April. New districts have also been added for implementation of hallmarking of jewellery.

“The second phase of the mandatory hallmarking will cover additional three caratages of gold jewellery/artefacts viz. 20, 23 and 24 carats as mentioned in the Indian Standard IS 1417, and 32 new districts under the mandatory hallmarking regime wherein an AHC (assaying and hallmarking centres) has been set up post implementation of the first phase of the mandatory hallmarking order,” says a Press Information Bureau release.

A-EPS Payments Through IPPB To Be Chargeable

The India Post Payments Bank (IPPB), a subsidiary of India Post, has announced the implementation of issuer charges for Aadhaar-enabled Payment System (AePS), with effect from June 15.

The first three AEPS transactions each month will be free. Thereafter, each withdrawal or cash deposit will cost Rs 20 plus GST. A mini statement transaction would cost Rs 5 plus GST, according to an IPPB statement. The India Post Payments Bank is a subsidiary of Indian Post, which is governed by the Postal Department.