India’s largest private-sector bank HDFC has given a great New Year’s resolution to its customers: a cut of 0.05% on its MCLR across selected tenors on their loans. Those rates getting revised are overnight, six months, one year, and even three years. It will differ for other tenors until now by % as relevant for them. New MCLR rates of HDFC Bank are effective from January 7, 2025, earlier.
Decreasing MCLR would give customers, on one side, a relief in loan rates and help them reduce their monthly EMI bills, which would lower their financial burden.
The bank has Reduced MCLR
New MCLR rates of HDFC Bank – Applicable from January 7, 2025
- Overnight MCLR of HDFC Bank will now be 9.15 percent. Earlier, the rate was 9.20 percent. The reduction of 0.05 percent.
- One month MCLR is 9.20 percent. There has been no change in this.
- MCLR for three months is 9.30 percent. There has been no change in this.
- MCLR for six months is down to 9.40 percent from 9.45 percent. The slashing was from 9.45 percent to 9.40 percent by 0.05 percent with this bank.
- MCLR for one year is down to 9.40 percent from 9.45 percent. The rate has been reduced by 0.05 percent, says the official statement.
- More than two years’ period indicates an MCLR of 9.45 percent previous, thereby: nil changes.
- For more than three years, the MCLR was 9.50 percent, which has been brought down 0.05 percent to reach 9.45 percent.
What happens when MCLR increases or decreases?
The bank has revised its MCLR (Marginal Cost of Funds Based Lending Rate). This is going to impact the EMIs of all floating loans like home loans, personal loans, and auto loans. If an increase in the MCLR happens, then, generally speaking, it means an increase in the interest rate of loans, and vice versa. This directly adds up to the interest burden on the borrowers.
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