HDFC Bank has cut its marginal cost of funds-based lending rate (MCLR) by 5 basis points (bps) across tenors. The rate cut is effective from Monday (June 8), according to its website.
HDFC Bank said its overnight MCLR stands reduced to 7.30 per cent, while one-month MCLR is 7.35 per cent. One-year MCLR, to which many of the consumer loans are tied, will now be 7.65 per cent, while three-year MCLR has been set at 7.85 per cent.
The move comes amid similar steps taken by the peers after two rate cuts by the Reserve Bank of India (RBI) in order to help the economic growth rise in the aftermath of the COVID-19 pandemic. The RBI has cut its key rates by 115 bps since March.
Banks review their MCLR every month. Lately, some part of the lending has also been linked directly to external benchmarks, such as the repo rate, for a better transmission of policy actions.