SBI’s announcement will make it expensive to repay loans linked to the benchmark prime lending rate
SBI’s announcement will make it expensive to repay loans linked to the benchmark prime lending rate
The country’s largest lender, State Bank of India (SBI), on Wednesday raised the benchmark prime lending rate (BPLR) by 70 basis points (or 0.7%) to 13.45%.
With this announcement, repayment of loans linked to BPLR will become costlier. The current BPLR rate is 12.75%. It was last revised in June.
“The Benchmark Prime Lending Rate (BPLR) has been revised as 13.45% p.a. with effect from September 15, 2022,” SBI posted on its website.
The bank has also raised the base rate by the same basis points to 8.7%, with effect from Thursday.
The EMI amount of borrowers taking loans at base rate will increase.
These are the old benchmarks on which banks used to lend. Now most banks offer loans at External Benchmark Based Lending Rate (EBLR) or Repo-Linked Lending Rate (RLLR).
The bank revises both the BPLR and the Base Rate on a quarterly basis. Other banks are also likely to revise the lending rate by SBI in the coming days.
The hike in benchmark lending rates comes weeks ahead of the Reserve Bank of India’s (RBI) monetary policy meeting, which is expected to hike rates again to contain inflation.
According to the schedule, the next three-day monetary policy meeting will be held from September 28 to September 30.