SBI hikes lending rates, EMI to go up

The marginal cost-based lending rates (MCLR) across various maturities have been increased by the State Bank of India (SBI), which accounts for more than a fifth of India's banking assets and the move will be in effect starting March 1, 2018.

Since the inception of a new lending rate system in April 2016, this is the first rate hike in the 1-year MCLR.

According to a notification, SBI raised the key 1-year MCLR to 8.15 percent from 7.95 percent.

The rise in lending rates generally indicates that EMIs (equated monthly instalments) will go up.

Introduced by the Reserve Bank of India (RBI), MCLR is a methodology setting the lending rates by the banks.

Tenor-wise MCLR will be as under -

Tenor Existing MCLR (%) Revised MCLR (%)

Over night 7.70 7.80

One month 7.80 7.80

Three month 7.85 7.85

Six month 7.90 8.00

One year 7.95 8.15

Two years 8.05 8.25

Three years 8.10 8.35

SBI raised interest rates on domestic bulk term deposits across most maturities on February 28, 2018.

Retail and bulk deposits interest rates have been hiked by up to 50 and 75 basis points. (100 base points = 1 percentage point).