A blow for HDFC Bank customers! Loan EMIs have become costlier; check the new interest rates..

Amidst the festive fervor, HDFC Bank—the country’s largest private-sector bank—has dealt a blow to its millions of customers. The bank has increased its Marginal Cost of Funds-based Lending Rate (MCLR) by 5 to 15 basis points across all seven tenures. This decision will directly impact the pockets of individuals whose home loans, personal loans, or car loans are linked to HDFC Bank’s MCLR.

HDFC Bank’s MCLR rates have now risen from the previous range of 7.75%–8.55% to a new range of 7.85%–8.70%. For longer-tenure loans—specifically those with tenures of 6 months, 1 year, 2 years, and 3 years—the bank has implemented a hike of 15 basis points (i.e., 0.15%). These new rates came into effect on November 7.

Will your EMI increase immediately?

If you have a floating-rate home loan, personal loan, or auto loan linked to HDFC Bank’s MCLR, your loan is bound to become more expensive. However, will you see a higher EMI amount being deducted as early as next month? The answer is: not necessarily.

The impact on your EMI will be reflected only when the 'reset date'—as specified in your loan agreement—arrives. For instance, if your loan is linked to the 6-month MCLR, the new, higher interest rate will apply from the next scheduled reset date for your loan. Depending on the bank’s policies and the structure of your loan, either your monthly EMI amount will increase, or the tenure of your loan (the total number of months for which you pay EMIs) will be extended.

Disclaimer: This content has been sourced and edited from News18 Hindi. While we have made modifications for clarity and presentation, the original content belongs to its respective authors and website. We do not claim ownership of the content.