State Bank of India (SBI), the country's leading private-run lender, has reduced its key lending rate by 5 basis points (bps) across all tenors. The new reduced rates will come into force from today i.e. July 10, 2019.
In a statement on Tuesday, the bank said that after the revision the one-year MCLR or marginal cost of funds based lending rate will decrease from 8.45% earlier to 8.4% per annum. Consequently, interest rates on all loans pegged to MCLR decrease by 5 bps. One basis point is one-hundredth of a percentage point.
MCLR is the minimum rate below which commercial banks are not allowed to lend money to borrowers.
Notably, this is the third rate cut by the bank in the ongoing financial year.