The country’s largest housing finance company HDFC Limited has brought down its lending rate by 20 basis points with effect from April 13. Following the reduction the bank will extend loans at 9.9% which is lower than what is being charged by State Bank of India.
The reduction in interest rates will bring down the equated monthly installment on a Rs 50 lakh loan (20 year tenure) by Rs 663. The equated monthly installment on the loan which was Rs 48583 under the earlier rate will come down to Rs 47,920.
Housing Development Finance Corporation or HDFC’s move comes two days after the RBI announced a status quo in its monetary policy review and Governor Raghuram Rajan prodded banks and lending institutions to pass on the previous two policy rate cuts effect since January this year.
The revised rate would be applicable for both new and existing customers. EMIs or equated monthly instalments are set to come down as a result of this reduction.
The HDFC rate cut comes in the wake of several big banks like SBI, ICICI Bank, Axis, and HDFC Bank cutting their base rates or the minimum lending rate.