HDFC Reduces its Retail Prime Lending Rate on Housing Loan
Two days after HDFC Bank cut its MCLR, HDFC announced on Friday to reduce the Retail Prime Lending Rate (RPLR) for its housing loans and non-housing loans. HDFC has stated in a statement that the interest rates on adjustable-rate home loans (ARHL) based housing loans and non-housing loans have been reduced by 20 basis points and the new rates have come into effect from Friday i.e. June 12.
Earlier, HDFC Bank on Wednesday reduced the Fund's Marginal Cost-Based Interest Rate (MCLR) by 0.05 percent. This deduction is made on the MCLR of each period and according to the bank's website, the new rates have come into effect from June 8. According to HDFC Bank, the MCLR has been reduced to 7.30 percent for one day, while 7.35 percent for one month period.
The one-year MCLR will now be 7.65 percent and most consumer loans are linked to this, whereas, the three-year MCLR will now be 7.85 percent. HDFC has taken this step amid the reduction in MCLR of other banks after the Reserve Bank's policy rate cut. The RBI has reduced the key policy rate (repo) by 1.15 percent since March to bail out the economy from the Covid-19 pandemic and lockdown. It should be noted that the banks review their MCLR every month.
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