SBI slashes affordable home loan rate to 8.35% for women

State Bank of India (SBI), India's largest lender, today announced a 0.10 per cent to 0.25 per cent reduction in interest rates for new borrowers of housing loans, bringing it to a low of 8.35 per cent for loans for affordable homes to women borrowers.

For male borrowers, the limited period offer, which is valid till 31 July, the reduction is 20 bps to 8.40 per cent, SBI managing director for national banking, Rajnish Kumar stated in a conference call.

Under the new government scheme, housing loans up to Rs30 lakh qualify for affordable housing.

The new rate reduction of 25 bps will apply for salaried women borrowers and for the non-salaried, the reduction will be 20 bps.

Similarly, the rates applicable to male salaried and non-salaried borrowers will also see a 0.05 bps difference.

SBI, which has the largest portfolio of home loans among all Indian banks, however, kept its marginal cost of lending rate (MCLR) unchanged at 8 per cent for the year.

The bank will now charge salaried borrowers 8.35 per cent on home loans up to Rs30 lakh as against 8.60 per cent at present.

For loans above Rs30 lakh the bank will charge 8.50 per cent, down 10 bps.

The bank will continue to charge 8.60 per cent on loans above Rs75 lakh. The rate cut will help only new borrowers since the existing borrowers are locked into one-year fixed rate on interest as per the rule of arriving at lending rates.

The 0.25 per cent reduction translates into a saving of Rs530 per month on EMIs. The new rates will be effective tomorrow.

With a home loan book of Rs2,23,000 crore, SBI leads the segment with 25-26 per cent market share.