Rate reduction for bank loans : The Baroda Bank The MCLR upgrade The Marginal Cost of Funds Based Lending Rate of Bank of Baroda has been lowered. The updated tariffs went into effect on June 12. The interest rate on home loans will also be impacted by this. Borrowers of home loans will gain a lot from this.
Rate reduction for bank loans
Bank of Baroda, one of India’s top public sector banks, has announced a reduction in its Marginal Cost of Funds Based Lending Rate (Bank of Baroda MCLR update) beginning June 12, 2025. The increased rates will apply to all new and existing MCLR-linked loans. The new reduced rates go into effect on Thursday, June 12. The Bank of Maharashtra has also reduced its interest rates on home, car, education, and retail loans tied to repo lending rates by up to 50 basis points.
Last Thursday, the Reserve Bank of India (RBI) reduced the repo rate by 50 basis points more than predicted. Not only that, but the central bank decreased banks’ Cash Reserve Ratios by one percent. Most banks have altered their interest rates in response to the repo rate drop.
The RBI’s six-member Monetary Policy Committee lowered the repo rate by 50 basis points, to 5.5%. In addition, the CRR was decreased by 100 basis points to 3%, adding Rs 2.5 lakh crore to the banking system’s existing excess liquidity.
Table of Contents
BOB reduces MCLR by five basis points.
The bank has cut the MCLR by 5 basis points for one-month to one-year terms.
- Overnight, the MCLR remained constant at 8.15%.
- The one-month MCLR was revised to 8.30% from 8.35%.
- The three-month MCLR was revised to 8.50% from 8.55%.
- The six-month MCLR was revised to 8.75% from 8.80%.
- The one-year MCLR has been revised to 8.90% from 8.95%.
How does an increase or decrease in MCLR impact house loans?
Revisions to the Marginal Cost of Funds Based Lending Rate can benefit customers taking out loans tied to the MCLR. Individuals affiliated with this may be eligible for lower interest rates on home loans, personal loans, and business loans.
The bank’s Marginal Cost of Funds Based Lending Rate (MCLR rate decrease June 2025) has a direct impact on the interest rate on your home loan. This is especially true if the loan has an adjustable rate. A decrease in the MCLR may result in a reduction in loan EMI. However, if it rises, so will the EMI. The interest rate on a house loan is often computed by adding a spread or margin to the MCLR. As a result, it has an impact on home loans.
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