Press Esc to close
Sunday 20 August 2017
News updated at 3:00 AM IST

Home, car loans to get cheaper

Annapurna Singh NEW DELHI, Jan 02, 2017, DHNS 0:55 IST
 Punjab National Bank (PNB), too, followed suit after India's largest public sector bank announced its decision. dh file photo
In a move that can make home and auto loans cheaper in the New Year, the State Bank of India on Sunday cut its benchmark lending rate by 90 basis points with immediate effect.

Punjab National Bank (PNB), too, followed suit after India’s largest public sector bank announced its decision.

“The bank has reduced marginal cost of funds-based lending rate (MCLR) by 0.9% from 8.90% to 8% for one-year tenure,” SBI said.

MCLR is the benchmark lending rate based on which interest rate for loans is fixed.
This is the steepest one-time cut in the SBI benchmark rate in the recent years. The bank has so far reduced the benchmark rate by 2% since January 2015. The reduction comes in the wake of banks flush with deposits post demonetisation.

The SBI is expected to announce revised rates for home and car loans on Monday.
The PNB reduced its one-year MCLR rate by 0.7% to 8.45%, effective Sunday. IDBI and State Bank of Travancore had on Friday reduced their benchmark lending rates by 15 and 30 basis points, respectively. Union Bank of India, too, cut it up to 90 basis points.

Prime Minister Narendra Modi, in his address to the nation on Saturday, had asked banks to utilise the “golden opportunity of historical cash reserves in their chests” and lend to poor and middle class.

“History is witness that the Indian banking system has never received such a large amount of money, in such a short time...I appeal to them to move beyond their traditional priorities, and keep the poor, the lower middle class, and the middle class at the focus of their activities,” the prime minister said on Saturday.

Demand for homes and vehicles came down heavily after discretionary spendings of people suffered due to limits imposed on currency withdrawals from banks post November 8 ban on high denomination notes.

India’s largest car maker Maruti Suzuki’s bookings dropped by 20% in November. The second largest car maker Hyundai too reported a significant fall in bookings.
Auto experts said December sales are expected to be muted.

According to bankers, the cut in lending rates will spur demand for retail and corporate loans and kick start economic activities temporarily halted due to demonetisation.

Go to Top

Photo Gallery
Bollywood actor Vidyut Jamwal showcases a creation by designer Kazingmei during Lakme Fashion...

Bollywood actor Vidyut Jamwal showcases a creation by designer Kazingmei during Lakme Fashion...

Farmers takes part in oxen race of Kalapoottu in Pullaloor in Kozhikode...

Farmers takes part in oxen race of Kalapoottu in Pullaloor in Kozhikode...

Youngsters sit inside Humes pipes at a city street in Kolkata...

Youngsters sit inside Humes pipes at a city street in Kolkata...

Devotees performs 'Deodhani', a traditional folk dance from the Indian state of Assam...

Devotees performs 'Deodhani', a traditional folk dance from the Indian state of Assam...

Children stand waist-deep in flood water as they wait for rescue workers in Katihar...

Children stand waist-deep in flood water as they wait for rescue workers in Katihar...

A  file photo of  Infosys CEO Vishal Sikka...

A file photo of Infosys CEO Vishal Sikka...

Trainee recruits of Army undergo physical training at the Parachute Regiment Training...

Trainee recruits of Army undergo physical training at the Parachute Regiment Training...

A Chimpanzee looks on, at Alipore Zoological Garden in Kolkata...

A Chimpanzee looks on, at Alipore Zoological Garden in Kolkata...

A beautiful view of peacock on blooming tree branch at Bengre in Mangaluru...

A beautiful view of peacock on blooming tree branch at Bengre in Mangaluru...

People with their household belongings move to a relief camp from a flood-hit region...

People with their household belongings move to a relief camp from a flood-hit region...

Like us on Facebook

Copyright 2017, The Printers (Mysore) Private Ltd., 75, M.G Road, Post Box 5331, Bengaluru - 560001
Tel: +91 (80) 25880000 Fax No. +91 (80) 25880523
Powered by Yodasoft Technologies Pvt. Ltd.