The stock of the country's largest lender State Bank of India (SBI) is set to be in focus as the bank's repo-rate linked home loan product becomes available from today. In early June, SBI had announced the launch of repo rate-linked home loan product effective from July 1. Before this, SBI's all new floating rate home loans were linked to the marginal cost of fund based lending rate (MCLR) since August 2016. 

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The SBI decision to launch the repo-rate linked home loan scheme came after the lender had linked its short-term loans and large savings deposits rates to the repo rate. "We will introduce repo-linked home loans from July 1," SBI had said in a statement. 

From today you will have the option to choose between an MCLR-linked home loan rate and the repo rate-linked home loan rate. If you opt for the repo-rate linked home loan, you will be directly impacted by repo rate changes announced by RBI. 

After the Reserve Bank of India (RBI) reduced repo rate by 25 basis points in early June, the commercial lender had also reduced its interest rate on the cash credit account (CC) and overdraft (OD) customers with limits above Rs 1 lakh. 

In the second bi-monthly policy of FY 2019-20, RBI monetary policy committee had unanimously decided to reduced repo rate by 25 basis points to 5.75 per cent, taking it to a nine-year low. The RBI had cited falling growth and to cushion the rising headwinds to the economy as the reasons for the repo rate cut. 

Responding immediately to repo rate cut by RBI,  SBI had said, "The benefit of reduction in the repo rate by 25 bps has been passed in its entirety to our CC/OD customers (limits above Rs 1 lakh), with effect from July 1."  (With agency inputs)