SBI cuts EBR, home loans to get cheaper from January

New Delhi: The State Bank of India (SBI) on Monday reduced the external benchmark-based rate (EBR) by 25 basis points to 7.80 percent from 8.05 percent, which would be effective from January.

With this, the EMI (equated monthly installment) on the existing home, and the MSME (micro, small, and medium enterprises) loans will come down.

The SBI’s EBR is finalized at 265bps plus a 5.15 percent repo rate of the Reserve Bank of India (RBI). The bank also charges a 10-75bps premium for pricing the effective interest on the home loans.

The RBI’s Monetary Policy Committee (MPC) had cut the benchmark lending rate (repo rate) by 25bps to 5.15 percent in October. However, after five consecutive rate cuts cumulatively amounting to 135 bps, the RBI kept the interest rates unchanged earlier this month.

RBI Governor Shaktikanta Das had said against the 135 bps repo rate cut, the reduction in retail loans had been only 44bps. (IANS)

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