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Loans to become costlier as public sector bank hikes lending rates

Mumbai: Leading public sector bank in the country, Canara bank has hiked marginal cost of funding-based lending rate (MCLR) across all tenors. The new MCLR rates came into effect from April 12. After this rate hike, the equated monthly instalments (EMIs) of all retail loans including car, personal and home will go up.

The lender updated that existing borrowers of the Bank shall have an option to switch over to interest rates linked to MCLR (other than Fixed Rate Loans). Borrowers willing to switch over to the MCLR based interest rate may contact the branch.

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The  overnight MCLR stands at 7.90%, one-month MCLR at 8%, three-month MCLR at 8.15%, six-month MCLR at 8.45%, and one-year MCLR at 8.65%. MCLR for other tenures has been kept unchanged.

MCLR is the minimum rate of interest banks are allowed to give out loans to its customers. It is a benchmark interest rate and it dictates the lower limit of the interest rate for a loan.

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