SBI slashes home loan rates: Cheapest in the market
What's the story
Bringing much cheer to India's home loan borrowers, the State Bank of India (SBI) slashed their interest rates by 0.15 percent, reports said. The interest rate cut comes in the wake of RBI's repo rate being reduced. The new rates are pitched to be their lowest rates in the last six years. Effective from 1 November, the offer is valid till 31 December 2016.
04 Oct 2016
RBI announces rate cut
India's central apex bank, the Reserve Bank of India, announced a rate cut last month to help boost the economy. The bank reduced the repo rate by 25 basis points to touch 6.25 percent. This was pitched to be the lowest repo rate since 2011. The rate cut was announced with reports stating that the country's current inflation targets can be achieved over time.
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How will the rate cut help consumers?
RBI's rate cut was said to help consumers gain access to cheaper loans as the repo rate, or the rate at which commercial banks borrowed money from the central bank, reduced. If banks pass on the benefit to loan borrowers, consumers stand to gain.
Savings
Specifics: SBI rate cut
The new rates are applicable for loans up to Rs.75 lakh. The bank stated that for woman borrowers, the interest rate is down to 9.10 percent from an earlier 9.25 percent, and for others, the interest rate is down to 9.15 percent from 9.30 percent. This would translate into savings of Rs.542 every month for a home loan of Rs.50 lakh of 30 years.
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Dena Bank, ICICI Bank lower rates
Dena Bank and ICICI Bank also lowered their interest rates, following SBI's interest rate cut. Dena Bank lowered its interest rate to 9.40 percent, while ICICI Bank lowered its lending rate by 0.10 percent.