Increase in the MCLR rate of HDFC bank: Customers of India’s largest private sector lender, HDFC Bank, are likely to have to shell out more money as interest if they have taken out a loan from the lender. HDFC Bank has increased its marginal cost of lending rate, or MCLR over all terms, according to its website. HDFC Bank’s new MCLR rates went into effect Wednesday, September 7. HDFC Bank MCLR’s rate hike comes at a time when several banks are raising their lending rates. Over the past three months, HDFC Bank has raised its lending rates by as much as 65 basis points.
HDFC Bank’s MCLR rate hike will mean that loan interest for new and existing borrowers is expected to increase, including monthly equivalent payments (EMI) for home loans, auto loans and any other marginal cost related loans. HDFC Bank’s MCLR was increased by up to 10 basis points, or 0.10%.
HDFC Bank’s MCLR rates for one day, one month and three months were raised to 7.90%, 7.90% and 7.95%, by 10 basis points on all mandates. For six-month and one-year terms, HDFC Bank’s MCLR rates are 8.05% and 8.20% respectively, also increased by 10 basis points. HDFC Bank’s MCLR was increased by 10 basis points to 8.30% and 8.40% for terms of two and three years respectively.
Here is the MCLR by tenor in effect as of September 7, 2022, according to the HDFC Bank website:
Overnight: old rate — 7.80%; New rate — 7.90%
One month: old rate — 7.80%; New rate — 7.90%
Three months: old rate — 7.85%; New rate — 7.95%
Six months: old rate — 7.95%; New rate — 8.05%
One year: old rate — 8.10%; New rate — 8.20%
Two years: old rate — 8.20%; New rate — 8.30%
Three years: old rate — 8.30%; New rate — 8.40%
Will Home Loan EMIs and Auto Loan EMIs Rise After HDFC Bank’s MCLR Rise?
Due to HDFC Bank’s rising MCLR rates, housing, vehicles and personal loans will become more expensive as EMIs rise. However, existing home loan borrowers should note that the EMI will only be reviewed when their loan reset date arrives. The lender will increase or revise the interest rate on borrowers’ home loans based on the MCLR in effect when the reset date arrives. This means that if a person’s home loan is based on the MCLR and the reset date is in September, they will have to pay the increased EMIs from September. Until then, the borrower will pay based on their existing rates.
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