Loans To Get Cheaper: IOB Cuts Repo Linked Lending Rate By 50 bps To 8.35%

News18

a day ago

It comes after the Reserve Bank of India-led by Sanjay Malhotra, unanimously decided to cut the repo rate by 50 bps to 5.50 per cent from 6 per cent. It was the third time that the central bank slashed the key benchmark lending rate, given that inflation was under control.
Earlier, several lenders, including Bank of India, UCO Bank, Punjab National Bank, Bank of Baroda, HDFC Bank and many more have announced to reduce MCLR or RLLR rates following the RBI's decision on repo rate. It makes new loans cheaper for borrowers and existing EMIs on loans lower.
Bank of Baroda (BoB) has cut its benchmark lending rate linked to repo rate by 50 bps. Likewise, HDFC Bank reduced its Marginal Cost of FUnds-based Lending Rates (MCLR) by 10 bps across tenure. It will benefit borrowers.
FD Rates Decrease
Lenders such as ICICI Bank, HDFC Bank and Kotak Mahindra Bank have announced the new FD rates for different tenures, shedding rates by few points.
When the repo rate decreases, it becomes easier for banks to borrow funds. So they don't need to rely on public to gather funds via FDs, therefore, they try to dissuade them or lower their cost of funds by lowering the rates.
ICICI Bank has revised its fixed deposit (FD) interest rates, lowering them by 25 basis points (bps) across select tenures. The new rates came into effect from June 10, 2025, and apply to both general and senior citizens for deposits below Rs 3 crore.
HDFC Bank has reduced interest rates on select fixed deposit (FD) tenures by up to 25 basis points (bps). It applies to deposits less than 3 crore and becomes effective from June 10, 2025.