IOB Cuts MCLR By 10 bps, EMIs Likely To Fall
India Overseas Bank has announced a cut in its Marginal Cost of Funds-based Lending Rate (MCLR) by 10 basis points across all tenors, effective July 15, 2025. This move is likely to benefit borrowers, as it can lead to cheaper loans and lower Equated Monthly Installments (EMIs).
The reduction in MCLR comes after the Reserve Bank of India (RBI) cut the repo rate by 50 basis points to 5.50 per cent, aiming to control inflation and boost economic growth. The RBI’s decision has led to a series of rate cuts by various lenders, including Bank of India, UCO Bank, Punjab National Bank, Bank of Baroda, HDFC Bank, and many others.
The cut in MCLR is a welcome relief for borrowers, as it can help them save money on their loan repayments. With the cost of borrowing decreasing, borrowers can expect to pay lower EMIs, which can be a significant financial burden off their shoulders.
Earlier, IOB Reduced RLLR By 50 bps
IOB had earlier reduced its Repo Linked Lending Rate (RLLR) by 50 basis points to 8.35 per cent, effective June 12. The reduction in RLLR was a response to the RBI’s repo rate cut and aimed to make borrowing cheaper for customers.
Other Lenders Follow Suit
Several other lenders have also announced cuts in their MCLR rates or RLLR rates following the RBI’s decision on the repo rate. Bank of Baroda (BoB) has cut its benchmark lending rate linked to the repo rate by 50 basis points, while HDFC Bank has reduced its Marginal Cost of Funds-based Lending Rates (MCLR) by 10 bps across tenure.
ICICI Bank has also revised its fixed deposit (FD) interest rates, lowering them by 25 basis points across select tenures. HDFC Bank has reduced interest rates on select fixed deposit (FD) tenures by up to 25 basis points. These rate cuts are likely to benefit borrowers and make borrowing cheaper.
What Does This Mean For Borrowers?
The cut in MCLR rates and RLLR rates is likely to have a positive impact on borrowers. With cheaper borrowing rates, borrowers can expect to pay lower EMIs, which can be a significant financial burden off their shoulders. Additionally, the reduction in MCLR rates can help borrowers save money on their loan repayments.
In conclusion, the cut in MCLR by IOB and other lenders is a welcome relief for borrowers. With cheaper borrowing rates, borrowers can expect to pay lower EMIs and save money on their loan repayments. This move is likely to boost economic growth and help borrowers manage their debt better.
