Mumbai: State Bank of India (SBI), the country's largest public sector lender, has increased its lending rates by 15 basis points, or 0.15 percentage points, effective October 15, 2026. The revision could make loans more expensive for customers whose interest rates are linked to the bank's Marginal Cost of Funds-Based Lending Rate (MCLR).
However, SBI has kept its overnight and one-month MCLR rates unchanged. The impact on borrowers will depend on their loan agreements and interest rate reset dates.
SBI Revises MCLR Across Tenures
According to the rates provided, SBI has increased its three-month MCLR from 8.25 per cent to 8.40 per cent. The six-month rate has risen from 8.60 per cent to 8.75 per cent.
The one-year MCLR, commonly used as a benchmark for certain loans, has increased from 8.70 per cent to 8.85 per cent.
Similarly, the two-year MCLR has been revised from 8.75 per cent to 8.90 per cent, while the three-year rate has increased from 8.80 per cent to 8.95 percent.
How Much Will Your Home Loan EMI Increase?
Borrowers with MCLR-linked home loans may face higher monthly instalments following the revision.
For example, a borrower with an outstanding home loan of Rs 30 lakh and a remaining repayment period of 30 years could see the monthly EMI increase by approximately Rs 350 to Rs 370, assuming the interest rate rises by the full 0.15 percentage points.
This could mean an additional annual payment of around Rs 4,200 to Rs 4,440.
The actual increase will depend on the outstanding loan amount, remaining tenure, applicable interest rate and repayment conditions.
Will All SBI Borrowers Pay More?
Not every SBI borrower will face an immediate increase in EMI.
Customers with MCLR-linked loans will see the impact only when their interest rates are reset according to their loan agreements.
Borrowers whose loans are linked to other benchmarks, including external benchmark lending rates, will not be directly affected by this particular MCLR revision.
In some cases, banks may extend the repayment tenure instead of increasing the EMI.
RBI Rate Hike Comes Before SBI Revision
The lending rate revision follows the Reserve Bank of India's monetary policy announcement on October 7.
The RBI increased the repo rate by 25 basis points to 5.50 per cent and changed its policy stance from neutral to calibrated tightening.
Borrowers should check their loan documents, applicable benchmark and next interest rate reset date to understand the possible financial impact.
