PNB, Indian Bank and Bank of India Cut MCLR by 5 BPS in July 2025 After RBI Repo Rate Cut; Home, Personal Loans May Get Cheaper

New Delhi, July 04: In a relief for borrowers, three major public sector banks—Punjab National Bank (PNB), Indian Bank, and Bank of India—have reduced their Marginal Cost of Funds-based Lending Rates (MCLR) by 5 basis points (bps) across various tenors starting July 2025. This move follows the Reserve Bank of India (RBI) cutting the repo rate by 100 basis points since February 2025 to boost credit and economic activity.

Earlier, the State Bank of India (SBI), the country's largest lender, announced reductions in its lending rates—cutting the Repo Linked Lending Rate (RLLR) by 50 bps to 7.75% and the External Benchmark Based Lending Rate (EBLR) to 8.15%. According to SBI, the revised rates are effective from June 15, 2025, and apply to both new and existing borrowers. RBI Repo Rate Cut: MPC Decided To Reduce Repo Rate by 50 Basis Points to 5.5%, Announces RBI Governor Sanjay Malhotra (Watch Video).

What Is MCLR?

The Marginal Cost of Funds-based Lending Rate (MCLR) is the minimum interest rate below which a bank cannot lend, except in certain cases. It directly affects loan EMIs for products like home loans, auto loans, and personal loans. RBI Extends Trading Hours for Call Money, Market Repo, and TREP From July 1; Check New Timings Here.

Punjab National Bank (PNB) MCLR Rates (w.e.f. July 1, 2025)

Indian Bank MCLR Rates (w.e.f. July 3, 2025)

Bank of India MCLR Rates (w.e.f. July 1, 2025)

With the one-year MCLR serving as the benchmark for most home loans, this reduction is expected to bring down EMIs for new borrowers and benefit existing borrowers at the time of loan reset. The move signals competitive lending and supports RBI’s efforts to stimulate the economy.

(The above story first appeared on LatestLY on Jul 04, 2025 12:04 PM IST. For more news and updates on politics, world, sports, entertainment and lifestyle, log on to our website latestly.com).