HDFC Bank loan EMIs may rise

HDFC Bank has announced an increase in its Marginal Cost of Funds-Based Lending Rates (MCLR) by up to 10 basis points (bps) on select tenures. 

This adjustment in MCLR will result in higher EMIs for individuals availing loans tied to these rates, impacting various consumer loans including personal, auto, and home loans.

Loans linked to MCLR undergo periodic resets, where interest rates are revised for borrowers. The latest revision sees an uptick in MCLR across different tenures. 

The overnight MCLR and one-month MCLR have both risen by 10 bps to 8.9% and 8.95%, respectively. 

Similarly, the three-month MCLR now stands at 9.10%, while the six-month MCLR is set at 9.30%.

Of particular significance is the one-year MCLR, crucial for several consumer loans, which has increased by 5 bps from 9.25% to 9.30%. 

Meanwhile, the two-year MCLR has been fixed at 9.35%, with the three-year MCLR remaining unchanged at 9.35%.

MCLR serves as the minimum interest rate that financial institutions must charge for specific loans, acting as the lower limit for loan interest rates. 

This rate remains fixed for borrowers unless modified by the Reserve Bank of India (RBI).