Mumbai: The country’s largest lender State Bank of India (SBI) decided to cut Marginal Cost of Fund Based Lending Rate (MCLR) by 5 basis points. This change will be effective from Wednesday, NDTV reported.
It may be noted that this is the first time SBI decided to cut lending rate in 10 months.
According to the report published in NDTV, SBI will lower MCLR for 1 year from 8% to 7.95%.
It may be noted that on 1st October 2017, SBI lowered the minimum average monthly balance (MAB) requirement in a savings account to Rs 3,000 from Rs 5,000 and also revised downwards penalties for not maintaining such a balance. The public sector lender also decided to exempt pensioners, beneficiaries of social benefits from government and minors from the requirement of minimum balance in a savings account.
Both steps of SBI is favourable for its customer. By lowing the minimum balance requirement, SBI reduced the penalty burden on the customer and by cutting the lending rates, it made loans cheaper.