In a major blow to the customers of the Punjab National Bank and the Bank of Baroda, their lending rates have been increased. This decision will directly impact the existing and potential customers of the banks who have secured loans from here. While the new rates have been implemented by PNB, BoB’s new rates will come into effect on February 12.
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PNB said in a recent regulatory filing that the repo-linked lending rates have been increased by 25 basis points. The lending rates now have been increased from 8.75 percent to 9 percent.
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The Bank of Baroda has increased MCLR by 5 basis points. The bank’s MCLR overnight increased from 7.85 percent to 7.90 percent. For at least one month, the MCLR has increased from 8.15 percent to 8.20 percent.
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The decisions have been taken as the Reserve Bank of India increased policy rates for the sixth time in a row. Amid rampant inflation, RBI has increased the repo rate by 25 basis points to 6.5 percent. They have been increasing repo rates since May of this year. The repo rate was first increased in May last year.
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With this increase, home loans, car loans and personal loans are slated to become more expensive. This is because with the increase of the repo rate, the banks will take money from RBI at a higher rate.
Both PNB and BoB will also lend at higher rates from now on.
