Attention SBI Customers: EMIs of home loan, personal loan go up as PSU bank hikes lending rate

SBI customers alert: India's largest public sector bank SBI has announced a 0.05 per cent increase in the marginal cost of fund-based lending rate (MCLR) in some tenors.

The one-year MCLR, a key tenor to which long-term loans like home finance are linked, has been increased by 0.05 per cent to 9 per cent effective from today i.e. November 15.

An increase in MCLR impacts EMIs

The increase in MCLR rates has a direct impact on the EMIs of personal loans, car loans and home loans. 

According to the official website of the State Bank of India, the bank has revised the MCLR rates for 3 months, 6 months and 1 year. The rates for 3 months have been increased from 8.50 per cent to 8.55 per cent, for 6 months it has been increased from 8.85 per cent to 8.90 per cent and for 1-year rates have been increased from 8.95 per cent to 9.00 per cent.

MCLR for one day, one month, two years and three years has remained unchanged.

42 per cent loan linked to MCLR

Bank chairman CS Shetty said that 42 per cent of the bank's loan segment is linked to MCLR, while the rest is based on external benchmarks. He also said that deposit rates in the banking system are at their highest level.

The lender has hiked the MCLR twice in the recent past, amid fears that the higher cost of deposits because of the war on the liabilities side among banks will ultimately result in higher ending rates.