State Bank of India (SBI), the country's largest lender, on Tuesday, announced a number of offers including cheaper rates for home loans, auto loans and education loans to cash in on festival season coming ahead.
SBI customers can avail the cheaper loans with added benefits such as waiver in processing fees, pre-approved digital loans and loans with no escalation in interest rates spread across various categories, SBI said in a statement.
The bank has not specified the time period for which this festival offer would be valid. However, the move would be followed by the other lenders as well. "SBI has waived processing fees on car loans during festival season. The bank is offering lowest interest rate starting from 8.70 per cent to customers opting for a car loan, with no escalation in interest," PTI quoted SBI.
No escalation will ensure that the customer will not have to face fluctuation in the interest rate.
Recently, SBI reduced the marginal cost of funds-based lending rate (MCLR) by 15 bps due to which overall home loan interest rate is now reduced by 35 bps since April 2019.
Currently, the bank offers cheapest home loan with an interest rate of 8.05 per cent as repo rate-linked home loan and this rate will be applicable to all existing and new loan from September 1, SBI said.
The State Bank of India has also announced to bring in SBI Home Loan with the lowest interest rate of 8.05% based on the #Repo Linked Lending Rate. "#SBI gives you an extra reason to celebrate! With the lowest interest rate of 8.05% based on the #Repo Linked Lending Rate, for your #HomeLoan this #festive season will definitely be more joyous," SBI tweeted on Monday.
#SBI gives you an extra reason to celebrate! With the lowest interest rate of 8.05% based on the #Repo Linked Lending Rate, for your #HomeLoan this #festive season will definitely be more joyous.— State Bank of India (@TheOfficialSBI) August 19, 2019
#StateBankofIndia #SBIHomeLoan #RLLR pic.twitter.com/7OymgzQ4cq
This might come as a piece of huge news for customers who have a home loan with SBI or are planning to shift their loan to it.
SBI waives processing fee on car loans
In a bid to boost car sales amid piling inventories, the State Bank of India (SBI) on Tuesday waived processing fee on car loans during the upcoming festival season and is also offering the lowest interest rate starting 8.70 per cent on car loans, with no escalation in interest.
For customers applying for a SBI car loan online through the bank's digital platform like YONO or website, a 25-basis point concession on the interest rate can be availed, it said.
The salaried customers can also avail the loan up to 90 per cent of the car's on-road price, it said.
The move is likely to be followed by other PSBs in different formats to make credit cheaply available to the buyers. Officials from at least three public lenders said they would respond to the SBI move in their own way to benefit auto buyers during the festival season.
The Indian auto sector is going through an unprecedented downturn. Auto sales in July this year fell to a 20-year low, and at the current monthly average sales, total projected annual sales of passenger vehicles for 2019-20 may drop to yearly sales levels seen in 2014-15 and 2015-16.
Tuesday's SBI announcement came after the largest Indian lender on Sunday extended by 15-30 days the loan repayment period for stressed automobile dealers to help them out of current inventory builds-ups. The bank has an exposure of Rs 11,500 crore to auto dealers.
"Normally, the repayment period is 60 days. So we extend it for 75 days for some dealers and to 90 days for a few others. We are talking to each dealer. We also had meetings with the Federation of Auto Dealers. We are actively engaged with all of them. On a case to case basis, whichever dealer has faced any problem on account of excess inventories, we have been working out solutions for all of them," said P.K. Gupta, Managing Director-Retail & Digital Banking, SBI.
SBI announces lower interest rates on Personal Loans
With regard to personal loan, it claimed Rs 20 lakh will be available at the lowest interest rate starting from 10.75 per cent with the longest repayment tenure of 6 years, reducing equated-monthly instalment (EMI) burden on the customers.
Additionally, salary account customers can avail pre-approved digital loans up to Rs 5 lakh through YONO.
SBI offers attractive RoI for Education Loans
Education loan would be available at an attractive interest rate of starting from 8.25 per cent for up to Rs 50 lakh and up to Rs 1.50 crore for studies in India and abroad, respectively.
Customers will be offered the longest repayment tenure of 15 years which effectively will reduce their EMI burden, it said.