These Banks Raise Lending Rates After RBI's Repo Rate Hike

The Reserve Bank of India (RBI) hiked the repo rate by 50 bps to 4.9% earlier this week on Wednesday. Soon after RBI's decision, many leading banks such as Kotak Mahindra Bank, ICICI Bank, Bank of Baroda, HDFC Bank, RBL Bank, and Federal Bank, among others revised their repo linked lending rate also known as RLLR.

Repo Rate: It is the rate at which RBI lends money to the banks if there is an occurrence of deficit of funds. Repo rate is extensively used by monetary authorities to bring inflation under control. There is a direct relation between repo rate and RLLR rate of banks i.e. if repo rate rises then RLLR rate will also surge which will imply a rise in the home loan interest rates.

Check the banks below that have revised their repo linked lending rates:

1. Kotak Mahindra Bank

Kotak Mahindra Bank offers home loan at the effective interest rate of 7.50%-8.00% (Home Loan interest rate for salaried individual). The home loan at Kotak Mahindra starts from 7.50% interest rate, according to the official website of the bank. Meanwhile, home loans for self-employed are available at an effective interest rate of 7.55%-8.10%.

2. ICICI Bank

ICICI Bank has revised the external benchmark lending rate also known as EBLR by 50 basis points to 8.60% on the lines of RBI's repo rate hike. The rates have already become effective on June 8, 2022, according to the official website of the bank.

3. Bank of Baroda

Bank of Baroda has also revised its Baroda repo linked lending rate or BRLLR. According to the official website of Bank of Baroda, "For Retail Loans applicable BRLLR is 7.40% w.e.f. 09.06.2022 (Current RBI Repo Rate:4.90%+Mark-Up-2.50%), S.P.0.25%."

4. HDFC Bank

HDFC will not offer home loans at the at 7.55%. Previously, the country largest housing finance company was offering loan at 6.7%.

5. RBL Bank

RBL Bank has also revised its home loan interest rate which has now jumped to 8.55% following RBI's move of hiking repo rate.