HDFC Bank Increases Loan Interest Rates: What Borrowers Need to Know About the New Rates

HDFC Bank Loan Interest Rates: The HDFC Bank's official website states that as of July 8, 2024, the bank's marginal cost of funds-based lending rates (MCLR) have been updated. For different tenures, there has been an increase in lending rates of up to 10 basis points (bps).

Changes in MCLR Rates

The bank has made the following adjustments to its MCLR rates:

• Overnight Tenure: The lending rate is now 9.05% instead of 8.95% after a 10 basis point decrease.
• One-Month Tenure: The rate has risen by 10 basis points, from 9% to 9.10%.
• Three-Month Tenure: The rate has been raised by 5 bps, making it 9.20% instead of 9.15%.
• Six-Month Tenure: 9.35% is now the new rate, up from 9.30% previously.
• One-Year MCLR: This crucial rate, which is frequently connected to consumer loans, is now 9.40% instead of 9.30%.
• Two-Year and Three-Year MCLR: The updated rate for these two tenures is 9.40%.

These changes are effective from July 8, 2024.

Understanding MCLR

The lowest interest rate a bank can charge on a loan is called the Marginal Cost of Funds-Based Lending Rate (MCLR). By establishing a minimum interest rate threshold, it makes sure that the bank's cost of funds is met. For borrowers, this rate is fixed unless otherwise specified by the Reserve Bank of India.

Prime Lending Rate and Base Rate

As of June 18, 2024, the benchmark prime lending rate of HDFC Bank is 17.90% annually. At the same time, as of June 18, 2024, the updated Base Rate is 9.40%.