The Reserve Bank of India has increased the repo rates by 50 bps, this is the fourth hike of the current cycle. The measures are taken by keeping in mind the surging inflation rate which is now bouncing around 7.0 percent. After a total hike of 190 bps now repo rates are benchmarked at 5.90%. So, all the other lenders have also increased their key lending rates including, “HDFC, Bank of Baroda, PNB, Union Bank, RBL, IndusInd Bank, and RBL Bank”. Let’s take a look at the interest rates increased by SBI and HDFC banks.

“The Monetary Policy Committee (MPC), comprising three members from the RBI and three external experts, raised the key lending rate or the repo rate to 5.90 percent — the highest since April 2019 — with five out of the six members voting in favor of the hike.”

SBI Increased Home Loan Interest Rates

SBI Hiked Interst Rates On October 1, 2022

With RBI’s call to hike the repo rates to fight inflation, lenders are also being forced to increase their key lending rates.

“The central bank hiked the policy rate by 50 bps (100 basis points = 1%) in its fifth monetary policy of the financial year on September 30, 2022.”

After the official statement released by the Monetary Policy Committee, commercial banks and NBFCs have announced a similar increase in external lending rates.

And among them, SBI is also one of the lenders who have announced an increase in their interest rates. As per SBI’s website, “SBI has hiked its external benchmark lending rate (EBLR) and repo linked lending rate (RLLR) by 50 bps. SBI’s EBLR stands at 8.55% and RLLR stands at 8.15%, from October 1, 2022.”

“The bank will determine the interest rate charged on the home loan by taking into account various factors. These include – CIBIL score, the profile of borrower (salaried or non-salaried, woman or man), risk assessment, loan to value ratio, etc.”, mentioned economic times.

HDFC Ltd Increased Lending Rates On Housing Loans

SBI and HDFC Bank Have Increased Their Interest Rates By 50 Bps

HDFC Ltd, the leading Mortgage lender in the country has hiked its interest rates by 50bps just hours after RBI announces an increase in its repo rates. All the banks have to comply and adapt to the RBI regulations and their decisions.

This strategy of HDFC Ltd. will result in increasing the EMIs on housing loans.

“HDFC increases its Retail Prime Lending Rate (RPLR) on Housing loans, on which its Adjustable Rate Home Loans (ARHL) are benchmarked, by 50 basis points, with effect from October 1, 2022”, the company said.

So far, in the last five months, HDFC has increased interest rates for the seventh time.