Indian Overseas Bank reduces interest rate on loans by 5 bps

Taking a cue from recent policy measures announced by Reserve Bank of India (RBI), Indian Overseas Bank reduced its interest rate on loans by 5 basis points for periods of one year and above.

Hence, various housing and vehicle loans will become marginally cheaper from Wednesday.

The marginal cost of funds based lending rate (MCLR) will be 8.15 per cent for overnight, 8.3 per cent for one month, 8.45 per cent for three months. 8.5 per cent for six months, 8.65 per cent for one year, 8.75 per cent for two years and 8.85 per cent for three years.

On April 4, the RBI had cut repo rate for the second consecutive time this year to 6 per cent in a bid to stimulate demand and economic growth. Repo rate is the rate at which the RBI lends money to commercial banks.

The move gave some relief to industry leaders from high borrowing costs just before the first phase of general elections.