Download MyFamilyInvestment Toolbar to keep updated of Best Investment Options!!!

India's top two private lenders have increased their benchmark lending rates, making loans more expensive for corporate and retail borrowers. While ICICI Bank has increased its base rate by 50 basis points (0.5%) to 8.75%, HDFC Bank has increased its base rate by 45 basis points to 8.2%. The increase is effective 24th February. The increase in rates would impact most new and old borrowers. However, existing auto loan borrowers are unlikely to be impacted since these loans are generally advanced at a fixed rate.

ICICI bank has also increased return on its deposits by 25 to 50 basis points. HDFC, on the other hand has however retained its old deposit rates. The buzz in the market is that the rates may increase further.

The latest increase in lending rates by ICICI Bank will make its home loans most expensive than two of its biggest rivals SBI and HDFC. ICICI Home loans will now cost 9.75% for borrowings up to Rs 30 lakh and 10.25% for larger borrowings. For a borrower with a 20-year loan, a 50-basis point increase in the lending rate would roughly translate into an increase of Rs 33 in EMI for Rs 1 lakh.


Free Update on Mobile
Subscribe to BestInvestments Google Groups

0 comments