Housing Development Finance Corporation (HDFC), the country’s oldest and largest home finance provider, on Tuesday cut interest rates on all loans by 50 basis points, helping about nine lakh customers save nearly Rs 400 crore in interest payments.
HDFC said it has reduced its prime lending rate (PLR), the benchmark to which interest rates on loans are linked, by 50 basis points to 14 per cent, the second reduction by an identical rate since December 2008.
For a new borrower, the effective floating interest rate would be 9.5 per cent for a loan of up to Rs 30 lakh, the same rate applicable on the special offer launched last month, and 10.5 per cent for loans above Rs 30 lakh.
The cut in the PLR will accrue to all the existing floating rate customers over the next three months depending on the respective reset dates.
Renu Sud Karnad, Joint Managing Director, HDFC said, “We have been able to bring down our costs due to improved operational efficiency and good quality portfolio. HDFC has ensured that the reduction in cost is passed on to existing customers.”