SBI loans get cheaper; Check details here

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New Delhi: In what could be considered as good news for the people those who want to take home loans and the senior citizens, the State Bank of India (SBI) has announced the reduction in its Marginal Cost of Funds-based Lending Rates (MCLR) by 15 bps across all tenors.

The SBI in a press release informed that one year MCLR comes down to 7.25% p.a from 7.40% p.a. with effect from May 10, 2020. This is the 12th consecutive reduction in bank’s MCLR.

Consequently, EMIs on eligible home loan accounts (linked to MCLR) will get cheaper by approximately Rs 255.00 for a 30-year loan of Rs 25 lakh, said the press note.

In view of adequate liquidity in the system as well as with the Bank, SBI prunes its interest rates on Retail term deposits by 20 bps for ‘upto 3 Years’ tenor, effective from May 12, 2020.

The press release further said that the bank has introduced a new product ‘SBI Wecare Deposit’ for Senior Citizens in the Retail TD segment to safeguard the interests of Senior citizens in the current falling rate regime, Under this new product, an additional 30 bps premium will be payable for Senior Citizen’s Retail term deposits with “5 Years & above” tenor only. This scheme would be in effect upto September 30, 2020.

Thus, the effective rate of interest for Retail TDs of Senior Citizens will be:

For Retail TD of ‘below 5 years’ tenor: 50 bps higher than the rate applicable for the general public (no change in premium)

For Retail TD of ‘5 years & above’ tenor (new product): 80 bps higher than the rate applicable for the general public (30 bps extra premium). This additional premium will not be payable in case of premature withdrawal of such deposits.

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