HDFC Bank loan interest rate has become expensive. The HDFC bank has increased its benchmark MCLR by 0.10 percent. Due to this, taking home, car and personal loans from the bank will become expensive. The bank’s revised rates are effective from February 8. The bank has given information about this on its website.
New Delhi: HDFC Bank has increased the interest rates on loans. It has increased the Marginal Cost of Funds Based Lending Rates (MCLR) by 0.10 percent. The new rates will be applicable from February 8. The bank has given this information on their website. MCLR is the minimum interest rate at which banks give loans to their customers. HDFC Bank’s MCLR ranges between 8.90 percent to 9.35 percent. Overnight MCLR has been increased from 8.80 percent to 8.90 percent. Similarly, one month MCLR has increased from 8.85 percent to 8.90 percent. Three-month MCLR has been increased from 9 percent to 9.10 percent. Six-month MCLR has been reduced to 9.30 percent. The one-year MCLR applicable to most customers has been increased from 9.25 percent to 9.30 percent. The 3-year MCLR has been maintained at 9.35 percent.
HDFC Bank Others Interest Rates
The revised base rate of the bank is 9.25%. This is effective from 25 September 2023. Benchmark PLR 17.85% per annum effective September 25. The repo rate and other lending rates are taken into account while adjusting the MCLR every month. No bank can give loan less than MCLR
What happens when MCLR increases in HDFC Bank?
When MCLR increases, it has many effects. Let’s see about that here:
- Increase in loan cost: MCLR is an important benchmark used by banks to decide loan interest rates. With increase in MCLR, loan interest rates also increase. This means that the borrower will have to pay more interest on the loan. This will increase their monthly installments. This makes taking a loan expensive.
- It becomes difficult to take a new loan: Due to increased interest rates, banks may be more cautious in giving loans to borrowers. This means it may be more difficult to get a loan, especially if they have a low credit score or income.
- Negative impact on household expenditure: Increase in MCLR increases the cost of loan, due to which people have less money to spend. This may reduce household expenses. This may slow down economic growth.
- Benefit for banks: The profit margin of banks increases as MCLR increases. This means banks can earn more profits.
- Benefits for the government: Increasing MCLR can increase tax revenue for the government.
This means the government will have more money to spend on public services.