Interest rate on home and auto loans to get dearer
State Bank of India (SBI) has revised base rate by 20 bps from 9.80% p.a. to 10% p.a. with effect from 07 November 2013. This will translate into dearer interest rate on home loans and auto loans. The revision came immediately after the RBI announced the hike in key policy rate, repo rate by 25 bps to curb inflation and inflationary expectations, though also eased liquidity in the system by reducing Marginal Standing Facility (MSF) rate by 25 bps.A hike in repo rate means the cost of sourcing the loan for the banks increases, and this effect is usually countered with them passing on the hike to consumers.
The SBI also revised the Benchmark Prime Lending Rate (BPLR) by 20 bps from 14.55% p.a. to 14.75% p.a.
HDFC Bank has also revised the base rate to 10% and BPLR to 18.50% with effect from 02 November 2013.
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