HDFC Bank has delivered a significant blow to its home loan and car loan customers by announcing an increase in loan interest rates.
The bank has raised its benchmark marginal cost of funds based lending rates (MCLR) by up to 15 basis points on certain term loans.
As a result, the equated monthly installments (EMIs) for various types of loans, including home loans, personal loans, and auto loans, will increase.
The MCLR is determined based on several factors such as deposit rates, repo rate, operating costs, and cash reserve ratio.
Changes in the repo rate are reflected in the MCLR, which subsequently affects loan interest rates, leading to an increase in the borrower’s EMI.
According to HDFC Bank’s website, the new MCLR rates will be applicable from July 7, 2023.
HDFC Bank’s Revised MCLR Rates:
- Overnight MCLR increased by 15 basis points from 8.10% to 8.25%.
- One-month MCLR increased by 10 basis points from 8.20% to 8.30%.
- Three-month MCLR increased by 10 basis points to 8.60% from the previous 8.50%.
- Six-month MCLR increased by 5 basis points from 8.85% to 8.90%.
- MCLR for a period of over one year remains unchanged at 9.05%.
As a result of the MCLR hike, the interest rates on all types of loans, including home loans, car loans, and personal loans, will be impacted.
Customers will now have to pay higher EMIs than before for their home loans, car loans, and personal loans. New customers seeking loans will also be subject to higher interest rates.
This decision by HDFC Bank reflects the prevailing market conditions and the impact of various economic factors on loan interest rates.
Customers are advised to review their loan agreements and financial planning accordingly to accommodate the increased EMIs.
