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In a relief for the common man, banks and NBFCs have off late announced rate cuts, with Union Bank of India and PNB Housing Finance Ltd joining the fray on Friday.
The Union Bank of India has reduced Marginal Cost of Funds-based Lending rate (MCLR) in the range of 5-15 basis points (bps) across all tenors.
In a statement, the bank said that its overnight MCLR has been reduced by 15 bps to 7.15 per cent, and one-month MCLR by 10 bps to 7.25 per cent. The three-month and six month MCLRs have been reduced by 5 bps to 7.40 per cent and 7.55 per cent respectively.
The one-year MCLR now stands at 7.70 per cent, down from 7.75 per cent. Revised MCLR will be effective from May 11, 2020. This is the eleventh consecutive rate cut announced by the bank since July 2019, it said.
The announcement comes a day after the country's largest lender State Bank of India (SBI) reduced its MCLR by 15 bps across all tenors with effect from May 10 while offering a new product for senior citizens in Retail Term Deposit segment.
On Friday, PNB Housing Finance also announced reduction of its retail lending rates, including individual home loan and loan against property by 15 bps with effect from Saturday (May 9).
In a statement, the housing finance company said that the benefit is provided to all its existing retail customers who have availed the loan before February 2020 on floating rates and will provide support and relief to them in the wake of Covid-19 lockdown.
Neeraj Vyas, Managing Director and CEO, PNB Housing Finance commented: "We welcome RBI's policy rate cuts by 75 bps. We are confident that the rate cut along with the three months of moratorium will ease the debt burden of the retail customers and stimulate healthy growth sentiment while confronting the unprecedented pandemic."
In March, the Reserve Bank of India (RBI) had announced an emergency repo rate of 75 bps to boost liquidity amid the coronavirus crisis.