SBI cuts MCLR rates by 25 basis points; no change in RBI repo rate

Mumbai: While the Reserve Bank of India’s (RBI) Monetary Policy Committee (MPC) maintained the repo rate at 6.50% during its October meeting, the State Bank of India (SBI) has reduced its marginal cost of fund-based lending rate (MCLR) by 25 basis points (bps), effective from October 15, 2024.

SBI’s move comes despite no rate cut by the RBI. The new MCLR rates, applicable until November 15, 2024, will impact home loans and other retail loans. The bank has reduced the MCLR for one-month tenures from 8.45% to 8.20%.

The overnight MCLR remains unchanged at 8.20%, while other tenures see no change either. The six-month MCLR is set at 8.85%, and the one-year MCLR at 8.95%. Rates for two- and three-year tenures stand at 9.05% and 9.10%, respectively.

MCLR, an internal benchmark, is the minimum interest rate banks can charge customers. The rate cut is expected to offer relief to borrowers, particularly in home loans.

SBI’s base rate remains at 10.40%, and its benchmark prime lending rate (BPLR) at 15.15%, both effective from September 15, 2024.

In its latest policy, the RBI has not changed the repo rate for the 10th consecutive time but shifted its stance to neutral, hinting at a potential rate cut in the coming months.

The central bank raised the repo rate by 2.50% between May 2022 and February 2023, but there has been no increase since.