Bank of India raises lending rate by 0.10% for various tenors

State-owned Bank of India has hiked the marginal cost of funds-based lending rate (MCLR) by 0.10% or 10 basis points for various tenors, it said in a statement.

“Bank of India has revised upward marginal cost-based lending rate for one-year at 8.50% while overnight rate up by 10 bps at 7.90%,” the statement said.

Among others, the one-month and three-month MCLR have been enhanced by 0.10% or 10 bps each to 8.20% and 8.30%, respectively.

The MCLR of the six-month tenor will bear an interest rate of 8.45%, up 0.10% from current rate of 8.35%. Bank of India said the enhanced rates would come into effect from June 10, 2018.

Big lenders such as SBI, ICICI Bank and HDFC Bank have already increased their MCLR making consumer loans such as auto, home and business loans costly.

Among those who have joined the bigger banks include private sector Karur Vysya Bank and Indian Bank.

Banks review the MCLR every month, which is a uniform methodology introduced from April 2016 to ensure fair interest rates to borrowers as well as banks.