India’s largest public sector lender State Bank of India (SBI) on Monday hiked its lending rate (MCLR) by 10 basis points, a move that will make all home, auto and personal loans costlier for all kinds of borrowers -- existing and future.
One basis point is equal to one hundredth of a percentage point.
MCLR or Marginal Cost of Funds Based Landing Rate is the base rate set for commercial banks as per the new RBI guidelines.
The hike, which comes into effect from April 15, will be implemented across all tenors, the lender said in a notification.
The move comes despite the Reserve Bank of India keeping key policy interest rates unchanged in its latest policy review earlier this month.
Other public sector lenders too are likely to follow suit.
The increase in lending rate by SBI comes two months after the bank had hiked interest rates on fixed deposits for tenure less than three years by upto 15 bps.
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