The State Bank of India (SBI) has raised its marginal cost of lending rate (MCLR) on select tenors by up to 25 basis points. Due to this latest MCLR hike, borrowers’ EMI outgo will increase further. The new interest rates are effective from December 15, 2022.

SBI MCLR
As per the SBI website, the MCLR for one month and three months has been raised from 7.75% to 8%; the MCLR for six months and one year has been raised from 8.05% to 8.30%. The majority of consumer loans, including auto, home, and personal loans, are tied to the MCLR. The MCLR for two years has been raised from 8.25% to 8.50%; and the MCLR for three years has been raised from 8.35% to 8.60%.

Also read: SBI increases home loan interest rates; Check how much your EMI will go up
Also read: RBI repo rate hike: Pay up to 23% higher EMI on your home loan than in April

Source: SBI Website
The bank had previously hiked MCLR on November 15, 2022 where SBI had raised rates by 10-15 basis points (bps) for all tenures.

SBI EBLR RLLR
SBI External Benchmark based Lending Rate EBLR from 8.55%+CRP+BSP to 8.90%+CRP+BSP and Repo Linked Loan Rate (RLLR) from 8.15%+CRP to 8.50%+CRP.

SBI BPLR
The banks Benchmark Prime Lending Rate (BPLR) revised as 14.15% p.a. w.e.f. 15.12.2022.

Will the rate increase persist in the future?
Despite continued rate increases, it still doesn’t appear to be the end. Inflation is the main driver of these rate increases. The RBI will be forced to use the interest rate hike option in addition to other inflation control measures till inflation falls below its comfort range of 2-6%.

Do note that the hike is likely to impact monthly outgo in EMI. The actual increase in EMI will depend on the amount of the outstanding loan, the loan’s remaining term, and the interest rate levied by the bank.
The bank will consider a number of factors when determining the interest rate charged on the mortgage. These include the CIBIL score, the borrower’s profile (whether they are employed or not, men or women), the risk assessment, the loan to value ratio, etc.