Mortgage lender Housing Development Finance Corporation (HDFC) on Monday cut its benchmark lending rate by up to 0.10 per cent, joining over a dozen banks and housing finance companies that have slashed rates in last few days.
"The bank has reduced its retail prime lending rate (RPLR) on housing loans, on which its adjustable rate home loans (ARHL) are benchmarked, by 10 basis points," HDFC said in a filing to the Bombay Stock Exchange.
The change, which will be effect from October 15, 2019, will benefit all existing HDFC customers, it added. New rates will now range between 8.25 per cent and 8.65 per cent.
The rate cut is in line with other lenders who followed the moderation in benchmark rate after the RBI cut interest rates for the third time this year by 25 basis points to its lowest level in nine years and signalled more easing as it looks to support the economy growing at its slowest pace in six years.
In the fourth bi-monthly monetary policy review, the RBI cut the repo rate to 5.75 per cent and reverse repo rate to 5.50 per cent and urged banks to transmit these to home, auto and other loan borrowers faster.
Last month, the Reserve Bank of India had made it mandatory for banks to link all new floating rate personal or retail loans to key repo rates or external benchmarks with effect from October 1. However, the central bank hasn't mandated this for housing finance companies (HFCs).
Edited by Chitranjan Kumar with PTI inputs