New Delhi: The State Bank of India (SBI) on Monday announced a reduction in its Marginal Cost of Funds-based Lending Rate (MCLR) by 10 basis points (bps) across all tenors.
Moreover, it has also lowered the interest rates on term deposits across all maturities by up to 25 basis points.
The move marked the fifth consecutive reduction in MCLR by the country’s largest bank so far this financial year.
The cut in interest rates comes after the Reserve Bank of India (RBI)’s 1.1 percentage point reduction in the repo rate – the key interest rate at which it lends short-term funds to commercial banks – so far this year.
Earlier, last week, the RBI had ordered all banks to link certain loans to the external benchmark-based interest rates from October 1, saying banks had not satisfactorily passed on the benefit of recent policy rate cuts to consumers.