Bank of India cuts MCLR up to 25 bps across category, deposit rate cut next

RBI has expanded liquidity in the system sizably to ensure financial markets and institutions are able to function normally, in the face of Covid-related dislocation

Government-owned Bank of India (BoI) will reduce its benchmark marginal cost of funds lending rate (MCLR) by15-25 basis points across categories from Wednesday.

This follows the Reserve Bank of India’s (RBI’s) huge liquidity injection to directly address the stress in financial conditions caused by Covid-19. The MCLR at BoI for a year stands reduced to 7.95 per cent from the earlier rate of 8.2 per cent. The new lending rate for overnight borrowing is 7.25 per cent.

The external benchmark lending rate, linked to RBI’s repo rate, has been reduced by 75 basis points (bps) to 7.25 per cent. With this, the