After SBI, HDFC, Axis Bank hikes lending rates by 35 basis points; car, home loan EMIs set to increase

HDFC, SBI and Axis Bank have increased prime lending rates -- a reason why your EMIs towards home, car and other types of loans are set to increase.

New Delhi: Following in the footsteps of major public and private banks such as HDFC and State Bank of India (SBI), among many others, yet another private lender, Axis Bank, has increased the marginal cost of lending rate (MCLR). The bank, on Wednesday (May 18), said in a statement that it has hiked MCLR by as much as 35 basis points. For the unversed, MCLR is a key factor that is taken into account while deciding various interest rates for home loans, car loans and other types of bank borrowings. According to the latest notification by Axis Bank, the increased lending rates will be applicable from May 18, 2022. 

With the latest move, Axis Bank MCLR rate has been increased to 7.55 per cent. Previously, the MCLR rate stood at 7.20 per cent. The private lender’s move to hike the MCLR rate comes in the backdrop of the Reserve Bank of India (RBI) hiking the repo rate by 40 basis points. 

Also, the latest interest changes in the interest rates vary depending on the term of the loan. For instance, the rate for three months has been hiked to 7.65 per cent from 7.30 per cent. On the other hand, the MCLR rate for six months has increased from 7.35 per cent to 7.70 per cent. 

Meanwhile, the MCLR for one year has been increased to 7.75 per cent from 7.40 per cent while the rate for two years hiked to 7.85 per cent from 7.50 per cent. On the other hand, the key lending rate for three-year tenure has increased gone up to 7.90 per cent from 7.55 per cent. Also Read: ITC Q4 net profit up 11.60 % at Rs 4,259.68 crore

Prior to Axis Bank, several other lenders such as SBI and HDFC have increased their prime lending rates. HDFC, on Saturday (May 7), announced an increase in its retail prime lending rate on home loans by 30 basis points with effect from May 9. Also Read: MNCs, IT firms on a hiring spree, plan to hire over 2 lakh employees in FY23 in India