Banks led by the State Bank of India (SBI) have started raising their lending rates, signalling a rise in equated monthly installments (EMIs) on retail loans, including home and car loans, more expensive borrowings for companies, and the end of a soft-interest regime which lasted for almost 18 months.
A day after hiking deposit rates by up to 75 basis points, SBI on Thursday increased the one-year Marginal Cost of Funds based Lending Rate or MCLR by 20 basis points (bps) to 8.15 per cent from 7.95 per cent. ICICI Bank, India’s largest private bank, raised its one-year MCLR from 8.2 per cent to 8.3 per cent and overnight MCLR rate from 7.8 per cent to 7.95 per cent. New loans will now become expensive as they are linked to the one-year MCLR.

Banks led by the State Bank of India (SBI) have started raising their lending rates, signalling a rise in equated monthly installments (EMIs) on retail loans, including home and car loans, more expensive borrowings for companies, and the end of a soft-interest regime which lasted for almost 18 months.
A day after hiking deposit rates by up to 75 basis points, SBI on Thursday increased the one-year Marginal Cost of Funds based Lending Rate or MCLR by 20 basis points (bps) to 8.15 per cent from 7.95 per cent. ICICI Bank, India’s largest private bank, raised its one-year MCLR from 8.2 per cent to 8.3 per cent and overnight MCLR rate from 7.8 per cent to 7.95 per cent. New loans will now become expensive as they are linked to the one-year MCLR.