Punjab National Bank, Indian Bank, IDBI Bank and Oriental Bank of Commerce have slashed interest rates on home, automobile and personal loans to fuel consumption and spur growth this festive season. Many banks have also decided to waive processing fees on retail loans.
The country’s biggest lender, State Bank of India, has also indicated that it may lower rates. Private sector lenders ICICI Bank and HDFC Bank have not yet taken any decision in this regard.
The move by the four banks to cut rates comes soon after the government and the RBI took steps to reduce the cost of funds for banks. However, this offer could be for a limited period of time.
PNB has reduced car loan rates by 1.10 percentage points to 10.65%. On loans for consumer durables, the bank has cut rates by 1-2% to a flat 12.75%. It has also waived the processing fee on home loans. The offer will be valid till January 31 next year.
Indian Bank has slashed interest rates on home loans to 10.20% irrespective of any limit and tenure from 10.45% earlier. It will also provide car and personal loans at the same rate.
OBC has cut rates on personal and consumer durables loans by 0.25 percentage points to 12.50% for government employees. For others, it will charge 13.50%. The new rates will be applicable from October 10.
A statement issued by the bank said car and two-wheelers loans will be available at 10.75% for repayment up to three years and 11% for repayment beyond three years.
“We have decided to reduce interest rates for customers for the festive season,” TM Bhasin, chairman and managing director, Indian Bank told Hindustan Times.