SBI home loans are cheaper from today, reducing the burden of monthly EMIs and increasing savings

India’s largest lender, State Bank of India (SBI), has announced a reduction in its key lending rates and some term deposit rates, effective today, December 15. Following the Reserve Bank’s policy repo rate cut, SBI has reduced interest rates by 25 basis points. This reduction will lower EMIs for existing customers and make loans cheaper for new borrowers. SBI’s External Benchmark Linked Rate (EBLR) has now been reduced to 7.90 percent.

All types of loans become cheaper
SBI has reduced its Marginal Cost of Funds-Based Lending Rate (MCLR) by 5 basis points across all tenors. The one-year MCLR, which is a key benchmark for many loans, is now 8.70%, down from 8.75%. Rates for other tenors, including overnight, one-month, and three-year MCLR, have also been reduced.

The bank has also announced a significant reduction in its External Benchmark Linked Rate (EBLR), which applies to most floating-rate retail loans such as home loans. The EBLR has been reduced by 25 basis points from 8.15% to 7.90%. Additionally, SBI has reduced its base rate for older borrowers from 10.00% to 9.90%.

For customers, these changes mean the possibility of relief in loan EMIs, especially for those with home loans linked to the EBLR and whose interest rates are due for reset. However, fixed deposit investors will mostly see stable returns, with only minor reductions in some specific schemes and tenors.

FD rates also reduced
Regarding deposits, most retail fixed deposit rates for amounts less than ₹3 crore remain unchanged. However, SBI has reduced the interest rate on its popular 444-day ‘Amrit Varsha’ fixed deposit scheme from the earlier 6.60% to 6.45%. For senior citizens, the rates remain higher across all tenures, although there has been a marginal reduction in the 2-3 year deposit slab, from 6.95% to 6.90%. For the general public, the rate for the same tenure has been reduced from 6.45% to 6.40%.