There's good news for customers who are paying EMIs for their loans with State Bank of India, Bank of Baroda and Allahabad Bank. From today, the EMIs of SBI loans - India's largest bank - will go down as the bank has reduced the MCLR by 0.05 per cent. Bank of Baroda and Allahabad Bank has also reduced the MCLR by the same value. The new rates are applicable from today (February 14).
What is MCLR?
It is Marginal Cost of Fund-based Lending Rates.
Well to put it simply. MCLR is the minimum rate at which banks can lend money to us. So if MCLR is reduced, this may mean that the EMI will also reduce.
The Allahabad Bank has reduced MCLR on loans with tenor period of one year. The MCLR was 8.30 per cent. it has now got reduced to 8.25 per cent. For loans of the maturity period of 1 month, Allahabad Bank has kept the MCLR unchanged at 7.85 per cent
For loans with tenor period of 3 and 6 months, there has been a reduction in MCLR by 3 to 5 basis points.
The new rates are effective February 14 onwards.