Rates of most consumer loans like auto loan and personal loan are decided on the basis of MCLR.
Private sector giant HDFC Bank on Thursday made loans with selected maturity periods costlier. The bank increased the marginal cost of funds based lending rate (MCLR) by 0.05 percent. According to the information available on the official website of the bank, now the marginal cost of funds based lending rate (MCLR) on selected loans has been increased by 0.05 percent. According to PTI news, the standard MCLR rate has been retained at 9.45 percent for a period of one year.
How much did MCLR increase?
According to the news, the rates of most consumer loans like auto loans and personal loans are decided on the basis of Marginal Cost of Funds Based Lending Rate (MCLR). Following the new announcement, the overnight MCLR has increased from 9.10 per cent to 9.15 per cent, while the one month rate has increased by 0.05 per cent to 9.20 per cent. There has been no change in the rates for loans with second maturity period. Lending rates for other tenors i.e. 3 months, 6 months and one year will remain the same i.e. 9.3 percent, 9.45 percent and 9.45 percent respectively.
Rates effective from November 7, 2024
The new rates have become effective from November 7, 2024. This rate increase comes after the Reserve Bank of India (RBI) decided to keep its policy rate repo unchanged at 6.5 percent for the tenth consecutive time. MCLR refers to the marginal cost of funds based lending rates below which lenders are not allowed to lend. In 2016, the Reserve Bank of India replaced the base rate system with MCLR based lending rates. Let us tell you, borrowers who had taken loans before 2016 still work according to the base rate or benchmark prime lending rates (BPLR).
Customers have been alerted
HDFC Bank advises customers to be cautious about fraudulent trading platforms in the name of providing investment opportunities. The largest private sector bank said most of the lucrative offers come through social media platforms and the advisory is aimed at raising awareness about potential investment frauds to protect customers. In investment fraud cases, fraudsters are usually seen promising abnormally high returns on investments in assets like shares, IPOs, cryptocurrencies, Bitcoin etc.
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