The switch over will be subject to a small fee—1% of the outstanding loan amount-- a top SBI official said
In a move that would help a large number of home loan customers to reduce their interest burden, nation's largest lender State Bank of India has decided to allow them to reprice their existing loans at lower rates.
The switch over will be subject to a small fee--one per cent of the outstanding loan amount-- a top official said.
The move is expected to help all those borrowers whose home loans are linked to the prime lending rate which is as high as 14.75% at present.
Currently the floating rate of bank is linked to the base rate which is ten per cent. SBI's current floating rates vary from 10.5% for up to Rs30 lakh loan, 10.75% for between Rs30 lakh and Rs75 lakh, and 11% for loans above Rs75 lakh.
“We thought of giving an option to our existing home loan borrowers who are on the prime lending rate to switch over to the new floating rates that are much lower than our prime lending rates. Anybody can reprice their loan by paying a 1% of their outstanding as an upfront fee,” managing director and chief financial officer of the bank, Diwakar Gupta, told PTI.
He further said there is no cap on the loan tenure or the amount of the loan to reprice their loan to a lower rate nor there is any time limit for the switch over.
The bank was prompted to take this measure in the wake of customers making enquiries about shifting their loans to other banks, according to sources.
The objective is to help the existing customers to lower their interest burden, which will in turn help the bank avoid possible delinquencies.
Fixed deposits with maturity period of 7-90 days will earn 8% interest against existing 7%, SBI said in a statement
SBI raised fixed deposit rates on select maturities by up to 1%, amid tight liquidity situation. Fixed deposits with maturity period of 7-90 days will earn eight per cent interest against existing seven per cent, State Bank of India (SBI) said in a statement. The new rates would be effective from tomorrow.
Interest rates on 91-179 day and 181-240 day period fixed deposits have been raised by 0.75% and 1%, respectively. The rate of interest will be 8% now. Interest rate on 241-day to one-year deposits has been raised by just 0.25% to 8%.
The bank has left interest rates on fixed deposits beyond one-year maturities unchanged. SBI last revised its fixed deposit rates in August 2011.
Yatra.com introduces a unique holiday-cum-shopping card for Indian customers
Yatra.com has launched a unique holiday-cum-shopping card for Indian consumers in the online travel category. The credit card has been designed in partnership with SBI Cards.
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