look news india
The country's largest public sector bank, State Bank of India, has increased MCLR rates. MCLR has increased from 8.85% to 8.95%. The new rates are effective from August 15, 2024. With the increase in MCLR, taking a bank loan will become more expensive. Not only this, now the installments of home loan, car loan and education loan will also have to be paid more. This will have a direct impact on the pockets of consumers.
Understand the maths here
Suppose you are going to take a loan of Rs 10 lakh, the tenure of which is 10 years i.e. 120 months and the spread is 1%. We will calculate the EMI in two situations. First MCLR is 8.85% and second MCLR is 8.95%, so let's see what the effect will be.
MCLR 8.85% Interest Rate 9.85%
Spread Loan spread is an additional interest charge of one percent which is linked to the MCLR rate
Total interest rate 8.85% + 1% = 9.85%
Monthly interest rate 9.85%/12 = 0.008208
MCLR 8.95%
MCLR- 9.95%
Spread: 1%
Total interest rate: 9.95 percent + 1% = 9.95 percent
Monthly interest rate 8.95% + 1% = 9.95%
On this EMI calculation, you will have to pay Rs 13,318 as per MCLR 8.85 percent EMI. If MCLR increases from 8.85 percent to 8.95 percent, there will be a difference of about Rs 91 in your EMI. Thus, an increase of 0.10 percent affects your EMI on MCLR and you have to pay more every month.
These banks also increased interest
Before SBI's MCLR hike, many banks have changed their MCLR and the new rates have also come into effect from this month. Talking about the banks included in this list, they include Bank of Baroda, Canara Bank and UCO Bank.
