SBI Cuts Lending Rates: Why Your Home Loan EMI Could Come Down Soon | Explained

Following a Reserve Bank of India rate cut, State Bank of India (SBI) has reduced its lending rates across key benchmarks like MCLR, EBLR, and RLLR. This action lowers borrowing costs for retail and corporate customers

If you have a home loan or are planning to take one from State Bank of India (SBI), there's some good news. The country's largest public sector bank has reduced its lending rates across key benchmarks, a move that could lower your monthly EMIs in the coming days.

The rate cut comes after the Reserve Bank of India (RBI) trimmed the repo rate by 25 basis points last week. Following the central bank's move, several lenders have started passing on the benefit to borrowers and SBI has now joined the list.

What Has SBI Announced?

SBI has reduced interest rates linked to multiple lending benchmarks, including the Marginal Cost of Funds-based Lending Rate (MCLR), External Benchmark Lending Rate (EBLR) and Repo Linked Lending Rate (RLLR). The bank has also revised its Benchmark Prime Lending Rate (BPLR) and base rate.

Together, these changes mean lower borrowing costs for both retail and corporate customers, especially those with home loans, auto loans and other retail credit.

SBI MCLR Cut: Who Benefits?

The bank has lowered its MCLR across various tenors by 5 basis points. This matters for borrowers whose loans are linked to MCLR, especially older home loans.

• Overnight and one-month MCLR have been reduced to 7.85%
• Three-month MCLR now stands at 8.25%
• Six-month MCLR has been cut to 8.60%
• The one-year MCLR, used for most retail loans, has been reduced to 8.70%
• Two-year and three-year MCLR now stand at 8.75% and 8.80% respectively

For existing borrowers, the impact will depend on the reset date of their loan. Once the reset kicks in, EMIs may come down or loan tenure could reduce.

EBLR and RLLR cut: Bigger relief for new-age borrowers

Borrowers with loans linked to external benchmarks are likely to see quicker relief. SBI has announced a 25-basis point cut in both EBLR and RLLR, effective December 15, 2025.

• EBLR has been reduced from 8.15% to 7.90%, plus Credit Risk Premium (CRP) and Bank Spread (BSP)
• RLLR, which is directly linked to the RBI's repo rate, has been lowered from 7.75% to 7.50%, plus CRP

Since these rates move in tandem with the repo rate, borrowers on EBLR and RLLR linked loans typically see faster transmission of RBI rate cuts to their EMIs.

What About BPLR and Base Rate?

SBI has also revised its legacy benchmarks:

• Benchmark Prime Lending Rate (BPLR) has been set at 14.65% per annum
• Base rate has been reduced to 9.90%

Both changes will come into effect from December 15, 2025.

Will Your EMI Fall?

In most cases, yes. But, the extent of the benefit will depend on your loan type, benchmark and risk profile. Borrowers with repo-linked loans are likely to see the fastest impact, while MCLR-linked loan customers may see changes after their reset period.