Your EMIs For Home, Vehicle Loans Can Become Expensive Because SBI Has Announced This Big Development

• EMIs are very likely going to become costlier as the State Bank of India, which is India’s biggest bank, has increased lending rates by 10 basis points. 
• On 18th April, SBI raised the marginal cost of lending rate (MCLR) by 10 basis points.
• The hike in rates has been caused by inflation.
• The continuing Russia-Ukraine conflict is negatively affecting our economy, which is going to significantly lower growth. 
• The supply disruptions that are caused by the conflict are leading to the surge in inflation and surge in monthly EMIs.

SBI has increased lending rates

EMIs are very likely going to become costlier as the State Bank of India which India’s biggest bank, has increased lending rates by 10 basis points at 0.1 percent across all loan tenors. The hike has become applicable from April 15. Kotak bank and Bank of Baroda have also hiked rates.

Other banks expected to follow in SBI’s footsteps

EMIs are going to increase for almost every kind of loan may it be home loan, vehicle loan, personal loan or any other loan. On 18th April, SBI raised the marginal cost of lending rate (MCLR) by 10 basis points. Most of the time, actions taken by the SBI are followed by other banks as well. Thus, a similar sort of action can be expected from other banks.

What is the cause of the rise in interest rates? 

The rise in rates is caused by inflation. The continuing conflict between Russia and Ukraine is negatively affecting our economy, it is going to significantly lower growth.  It was observed in the last monetary policy of the RBI that there was no change in the interest rates even though economists were expecting a rise because of inflation. But, the banks have now started doing it. And, interest rates are going to become costlier from here on.

India will have to wait to see how long the crisis between Russia and Ukraine will continue. Almost everything will now depend upon and be impacted by the geopolitical situation. The supply disruptions that are caused by the conflict are leading to the surge in inflation and surge in monthly EMIs.