Mumbai: Buying a home in Mumbai just got a bit easier. Canara Bank, one of India’s big public sector banks, has dropped its Marginal Cost of Funds-Based Lending Rate (MCLR) by 0.05 percent across different loan periods. Starting November 12, this change makes home, car, and personal loans a little more affordable for everyone—whether you’re just taking out a loan or you’ve been paying one off for years.
Here’s what that actually means for home loan borrowers: If your home loan has a floating rate linked to the MCLR, you’ll see your monthly payments go down a little. It’s not a huge drop, but it adds up—especially if you’ve borrowed a lot over a long period. Take a loan of Rs 30 lakh over 20 years, for example. This rate cut could trim your EMI by about Rs 150 to Rs 200 each month, depending on exactly how your loan is set up.
Here’s the new MCLR breakdown from Canara Bank:
Overnight MCLR: 7.90 percent (was 7.95 percent)
1-Month MCLR: 7.95 percent (was 8.00 percent)
3-Month MCLR: 8.15 percent (was 8.20 percent)
6-Month MCLR: 8.50 percent (was 8.55 percent)
1-Year MCLR: 8.70 percent (was 8.75 percent)
2-Year MCLR: 8.85 percent
3-Year MCLR: 8.90 percent
This is Canara Bank’s first big rate cut this quarter. It’s a good sign for anyone with a retail loan, especially since other major banks like Bank of Baroda and IDBI Bank haven’t made similar moves yet.
And if you’re wondering what MCLR actually is—it’s basically the lowest interest rate at which banks can lend. It decides how much interest you pay on floating-rate loans like home or car loans. When banks lower the MCLR, your EMI drops, or you can choose to pay off your loan faster. So, if you’re already paying off a loan, this is welcome news.
