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HDFC Bank Rate Cut: Private bank HDFC has provided significant relief to its customers. The bank has reduced its MCLR rates by up to 10 basis points, providing some interest relief to borrowers. Let’s explore the new MCLR rates and when they will be implemented.
HDFC Bank Rate Cut: HDFC Bank, one of the country’s largest private banks, has provided significant relief to its customers. The bank has reduced its Marginal Cost of Funds-Based Lending Rates (MCLR). This will result in slightly lower EMIs for home loans, auto loans, and personal loans. The bank has reduced interest rates by 10 basis points (bps), or up to 0.10%, depending on the tenure. The new rates are effective from November 7, 2025.
This change will benefit customers whose loans are linked to MCLR. The bank’s MCLR rates will now range between 8.35% and 8.60%, down from 8.45% and 8.65% previously. This means your home loan EMI will be slightly lower. It’s worth noting that MCLR is directly linked to loan rates. The bank cannot offer loans below MCLR rates. If the bank reduces the MCLR, loan rates will automatically decrease, and customers will directly benefit from this.
HDFC Bank’s New MCLR Rates
- The bank has released new rates for different tenures.
- HDFC Bank’s overnight MCLR rate: Reduced from 8.45% to 8.35%.
- 1-month MCLR rate: Reduced from 8.40% to 8.35%.
- 3-month MCLR rate: Reduced from 8.45% to 8.40%
- 6-month MCLR rate: Reduced from 8.55% to 8.45%
- 1-year MCLR rate: Reduced from 8.55% to 8.50%
- 2-year MCLR rate: Reduced from 8.60% to 8.55%
- 3-year MCLR rate: Reduced from 8.65% to 8.60%
What is MCLR?
MCLR (Marginal Cost of Funds-Based Lending Rate) is the minimum interest rate at which a bank can lend to a customer. It was introduced by the Reserve Bank of India (RBI) in 2016 to bring transparency to interest rates. When a bank’s funding costs decrease or liquidity in the system increases, the bank reduces the MCLR. Based on this, the EMI of floating rate loans (such as home loans, business loans, etc.) also fluctuates. Whenever a bank reduces its MCLR, all loan rates linked to it also fall. This means that customers whose loans are linked to MCLR benefit from the reduction in interest rates in their EMIs.
Learn how MCLR is determined?
HDFC Bank’s current base rate is 8.90%, effective September 19, 2025. The bank’s benchmark prime lending rate (BPLR), or standard interest rate, is set at 17.40% per annum. To determine MCLR, the bank considers interest rates on deposits, the repo rate, operational costs, and the cost of CRR (cash reserve ratio). When the RBI changes the repo rate, it impacts the MCLR.
What are the new home loan interest rates?
HDFC Bank’s home loan interest rates are now linked to the repo rate. According to the bank, the rates for salaried and self-employed individuals range from 7.90% to 13.20%. This means that if the RBI further reduces the repo rate, the bank may also reduce its interest rates further, further reducing customers’ EMIs.
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