HDFC Bank has revised its marginal cost of funds-based lending rates, also known as MCLR. The new rates will come into effect from February 7, 2024 onwards.
The MCLR now varies between 8.9 percent to 9.35 percent across tenures.
The overnight MCLR rate has been raised by 10 basis points to 8.9 percent, one-month MCLR after rising by 10 basis points is now 8.95 percent, 3-month MCLR is 9.10 percent and six-month MCLR is 9.30 percent.
The one-year MCLR, which is the rate linked to a number of consumer loans, rose by 5 basis points from 9.25 per cent to 9.30 per cent. The 2-year MCLR is now 9.35 per cent and 3-year MCLR remains unchanged at 9.35 percent.
| Tenor | MCLR |
| Overnight | 8.9 |
| 1 month | 8.95 |
| 3 months | 9.10 |
| 6 months | 9.30 |
| 1 year | 9.30 |
| 2 years | 9.35 |
| 3 years | 9.35 |
(Source: HDFCbank.com; Rates will come into effect from Feb 7, 2024)
Other interest rates
Other interest rates, however, continue to be the same. HDFC Bank’s base rate since Sept 25, 2023 has been 9.35 percent. And benchmark PLR (prime lending rate) stands at 17.85 per cent with effect from Sept 25, 2023.
What is MCLR?
The marginal cost of funds-based lending rate (MCLR) is the minimum interest rate below which the bank is not supposed to lend to borrowers. Prior to the emergence of MCLR, the minimum rate enforced by RBI used to be the ‘base rate’.
The revision of MCLR comes in the run up to the RBI’s monetary policy committee (MPC) that kicked off on Feb 6.
Headed by RBI Governor Shaktikanta Das, the central bank’s MPC started three-day deliberations in Mumbai on 6 February. This is the first policy committee of this calendar year, and also happens to be the first meeting after the presentation of Interim Budget 2024.
Experts believe that RBI will keep its key policy rate – unchanged for the sixth consecutive time at 6.5 per cent.
According to Madan Sabnavis, Chief Economist, the Bank of Baroda, there is a very high likelihood that the repo rate will remain unchanged again.
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Published: 07 Feb 2024, 02:48 PM IST