By: ABP News Bureau | Updated at : 15 Mar 2023 11:04 AM (IST)
SBI has raised its BPLR by 70 basis points to 14.85 per cent ( Image Source : Getty )
State Bank of India (SBI) has raised its benchmark prime lending rate (BPLR) by 70 basis points to 14.85 per cent and base rate by 70 bps to 10.10 per cent from Wednesday, as per information on the bank website. The rates are altered in a quarterly cycle. Earlier, the lender revised the BPLR and base rate on December 15.
The hike comes after the Reserve Bank of India (RBI) raised the repo rate, or the rate at which it lends short-term funds to commercial banks, to 6.50 percent from 6.25 percent.
ALSO READ: IDFC First Bank Revises Interest Rates On Savings Account. Check Current Rate
However, the country’s largest lender has left the marginal cost of lending rates (MCLR) unchanged. The overnight MCLR rate is 7.90 per cent, while that of one month tenure is 8.10 per cent. The three-month MCLR is 8.10 per cent and for the six-month it stands at 8.40 per cent and 8.50 per cent on one-year tenure. For tenure of two years and three years MCLR is 8.60 per cent and 8.70 per cent, respectively.
The hike in the base rate and BPLR record may not be of significant concern for borrowers as maximum number of borrowers have their loans already linked to the external benchmark linked rate (EBLR) or MCLR.
What is BPLR?
Benchmark prime lending rate (BPLR) was used as a benchmark rate by banks for lending till June 2010. BPLR was calculated based on the average cost of funds. However, BPLR lacked transparency as lenders could lend below it to some privileged customers. So, in 2010, the Reserve Bank of India introduced the Base Rate system, which replaced the BPLR system.
What is Base Rate?
“The Base Rate was the minimum interest rate at which Indian banks could lend. They were not permitted to resort to any lending below this rate The base rate was determined significantly on the average cost of funds. As per RBI policies, lenders were required to review their base rate at least once every quarter. MCLR was introduced in April 2016 by RBI in place of base rate,” the Kotak Mahindra Bank website added.
In November last year, SBI chairman Dinesh Khara said that 74 per cent of the bank’s total home loans are linked to the MCLR and EBLR. About 21 per cent of the loans are fixed rate and the rest of the loans are still attached to BPLR (4 pe cent), he added. SBI’s gross advances rose 17.6 per cent on year to `31.33 lakh crore as of December end.
SEBI Guidelines Push Finfluencers To Reevaluate Content And Monetisation Strategies
Rising Insurance Premiums And Coverage Gaps. How Indian Consumers Can Stay Ahead In 2024
Lost Your Aadhaar Card? Here's How You Can Recover It
Market Momentum Could Propel Sensex To 90,000 And Nifty To 27,000 By December
Budget 2024: Govt Likely To Increase Provident Fund Limit After A Decade
Case Filed Against TMC MP Mahua Moitra For Social Media Post Against NCW Chief
Mumbai Hit-And-Run: Shiv Sena Leader Detained As Son Knocks Woman To Death, Aditya Thackeray Meets Victim's Family — Top Points
Tamil Nadu BSP Chief Killed: Madras HC Rejects Plea For K Armstrong's Burial At Party Office As DMK Govt Opposes Proposed Site
IND vs ZIM 2nd T20I Live Score: Abhishek Sharma's Swashbuckling Maiden International Ton Powers India To 234/2