State Bank of India, the country's top lender, today raised its lending rates by up to 25 basis points, but this move will hit the common man.
SBI's one-year marginal cost-based lending rates (MCLR), a rate that determines lending rates for the SBI's home and car loans, to 8.15 per cent from 7.95 per cent.The SBI's move to raise interest rates will likely see other banks follow suit.
This is the first time the state-run bank has hiked one-year MCLR since April 2016,. The SBI's move to raise its lending comes despite the Reserve Bank of India maintaining status quo on its rates.
Today's decision also comes a day after SBI raised interest rates on deposits across most maturities. The rates were hiked steeply by up to 0.75 per cent with immediate effect.
That revision comes after three consecutive revisions in the rates by SBI on bulk term-deposits in the past three months.Several banks have been increasing their deposit and lending rates since the last quarter.
While lending rates have been jacked up on an average of 5-10 bps by private sector lenders like HDFC Bank, Axis Bank, Kotak Mahindra Bank and Yes Bank since January, almost all the state-run lenders have been increasing their bulk deposit rates in the range of 15 bps to 125 bps.